Shenzhen China Bicycle Company (Holdings) Limited
Annual Report 2022
April 2023
Annual Report 2022
Section I. Important Notice, Contents and Interpretation
Board of Directors, Supervisory Committee, all directors, supervisors and senior
executives of Shenzhen China Bicycle Company (Holdings) Limited (hereinafter
referred to as the Company) hereby confirm that there are no any fictitious
statements, misleading statements, or important omissions carried in this report,
and shall take all responsibilities, individual and/or joint, for the reality,
accuracy and completion of the whole contents.
Wang Shenghong, Principal of the Company, Sun Longlong, person in charge of
accounting works and She Hanxing, person in charge of accounting organ
(accounting principal) hereby confirm that the Financial Report of 2022 Annual
Report is authentic, accurate and complete.
All directors are attended the Board Meeting for Report deliberation.
The Company plans not to distribute cash dividends, not to send bonus shares,
and no reserve capitalizing.
Contents
Section I. Important Notice, Contents and Interpretation .......................................... 2
Section III Management Discussion and Analysis ..................................................... 11
Section IV Corporate Governance .............................................................................. 35
Section VII. Changes in Shares and Particulars about Shareholders ........................ 72
Section VIII. Preferred Stock ....................................................................................... 82
3
Documents Available for Reference
1. Accounting statement carrying the signatures and seals of the legal representative, person in charge of
accounting and person in charge of accounting organ.
2. Originals auditing report carried with the seal of accounting firm and signature & seal of the CPA.
3. Originals documents of the Company and manuscripts of public notices that disclosed in the newspaper
designated by CSRC during the reporting period.
4. English version of the Annual Report 2022
4
Interpretation
Items Refers to Contents
Company, the Company, the listed Shenzhen China Bicycle Company
Refers to
company, CBC Group (Holdings)Limited
Wansheng Industrial Holdings
Wansheng Industrial Refers to
(Shenzhen) Co., Ltd.
Shenzhen Guosheng Energy Investment
Guosheng Energy Refers to
Development Co., Ltd.
CSRC Refers to China Securities Regulatory Commission
SSE Refers to Shenzhen Stock Exchange
SGE Refers to Shanghai Gold Exchange
SDE Refers to Shanghai Diamond Exchange
CNY Refers to RMB/CNY
Stock of the Company listed on Stock
Listing Refers to
Exchange
5
Section II. Company Profile and Main Financial Indexes
I. Company information
Short form of the stock Zhonghua A, Zhonghua B Stock Code 000017, 200017
Short form of the Stock
N/A
before changed (if applicable)
Stock Exchange for listing Shenzhen Stock Exchange
Name of the Company (in
深圳中华自行车(集团)股份有限公司
Chinese)
Short form of the Company
深中华
(in Chinese)
Foreign name of the
Shenzhen China Bicycle Company (Holdings)Limited
Company (if applicable)
Short form of foreign name of
CBC
the Company (if applicable)
Legal representative Wang Shenghong
Registrations add. No. 3008, Buxin Rd., Luohu District, Shenzhen
Code for registrations add 518019
Historical changes of
N/A
registered address
Offices add. 501 Zhongxin Technology Building, No.31 Bagua Rd., Bagualing, Futian District, Shenzhen
Codes for office add. 518029
Internet Web Site www.szcbc.com
E-mail dmc@szcbc.com
II. Person/Way to contact
Secretary of the Board Rep. of security affairs
Name Sun Longlong Yu Xiaomin, Zhong Xiaojin
501 Zhongxin Technology Building, 501 Zhongxin Technology Building,
Contact add. No.31 Bagua Rd., Bagualing, Futian No.31 Bagua Rd., Bagualing, Futian
District, Shenzhen District, Shenzhen
Tel. 0755-25516998,28181666 0755-25516998,28181666
Fax. 0755-28181009 0755-28181009
E-mail dmc@szcbc.com dmc@szcbc.com
III. Information disclosure and preparation place
Website of the Stock Exchange where the annual report
Shenzhen Stock Exchange(http://www.szse.cn)
disclosed
Media and Website where the annual report disclosed Securities Times, Juchao Website (http://www.cninfo.com.cn)
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501 Zhongxin Technology Building, No.31 Bagua Rd.,
Preparation place for annual report
Bagualing, Futian District, Shenzhen
IV. Registration changes of the Company
Uniform Social Credit Code 914403006188304524
Main products or services provided at present: Emmelle
Changes of main business since listing (if applicable) bicycle, electric bicycle, lithium battery materials and gold
jewelry.
1. In March 1992, the Stock of the Company was listed in
Shenzhen Stock Exchange, and 23.28% equity of the Company
was held by Shenzhen Lionda Holding Co., Ltd. and Hong
Kong Dahuan Bicycle Co., Ltd respectively. 2. In March 2002,
legal shares 13.58% A-stock of the Company was obtained by
China Huarong Asset Management Co., Ltd. through court
auction, and became the first majority shareholder of the
Company. 3. On 13 November 2006, the 65,098,412 legal
shears of CBC held by Huarong Company was acquired by
Shenzhen Guosheng Energy Investment Development Co., Ltd.
via the “Equity Transfer Agreement” signed, and first majority
of the Company comes to Guosheng Energy. Guosheng Energy
is the wholly-owned subsidiary of National Investment, actual
controller was Zhang Yanfeng. 4. In January 2011, controlling
shareholder of Shenzhen Guosheng Energy Investment
Development Co., Ltd.—Shenzhen National Investment
Development Co., Ltd. entered into equity transfer agreement
Previous changes for controlling shareholders (if applicable) with Mr. Ji Hanfei, 100% equity of Guosheng Energy was
transfer to Mr. Ji Hanfei with price of 70 million. Shenzhen
Guosheng Energy Investment Development Co., Ltd. Shenzhen
Guosheng Energy Investment Development Co., Ltd. holds
63,508,747 A-stock of the Company with 11.52% in total share
capital of the Company. 5. On February 20, 2017, Ji Hanfei and
Guosheng Energy made an “Explanation” to abandon the actual
control of the Company, after Ji Hanfei made the declaration to
abandon the actual control of the Company, the investment
from CBC by Mr. Ji changed to general investment instead of
actual controlling, and the actual controller of the Company
changed from Ji Hanfei to no actual controller. 6. On
November 7, 2022, the newly added non-public offering of
shares of the company were listed on the Shenzhen Stock
Exchange. Wansheng Industrial holds 137,836,986 shares of
the company through the subscription of non-public offering of
shares, accounting for 20% of the total share capital after the
completion of the non-public offering. On November 28, 2022,
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the company held the second interim general meeting of
shareholders in 2022 to review and approve the Proposal on
Nominating Candidates for Non-Independent Director and the
Proposal on Nominating Candidates for Independent Director,
and the board of directors of the company completed the
change of the term of office. Given that Wansheng Industrial
holds 20% of the stock equity of the company and determines
more than half of the seats on the board of directors of the
company, Wansheng Industrial can therefore have a significant
influence on the resolutions of the company's general meeting
of shareholders and the board of directors. Therefore, the
company was changed from a company without controlling
shareholder and actual controller to a company with controlling
shareholder and actual controller, the controlling shareholder of
the company was changed to Wansheng Industrial, and the
actual controller of the company was changed to Mr. Wang
Shenghong.
V. Other relevant information
Accounting firm engaged by the Company
Name of the accounting firm Baker Tilly China CPA (LLP)
A-1 and A-5 of No.68 Building, No.19 Chegongzhuang West
Offices add. for CPA
Road, Haidian District Beijing
Signatory accountant Qu Xianfu, Deng Jun
Sponsor engaged by the Company for performing continuous supervision duties in reporting period
Applicable □Not applicable
Sponsor Office address of the sponsor Sponsor representatives Continuing supervision period
23/F Zizhu International
Building, No. 1088, Fangdian 7 November 2022-31
Sinolink Securities Co., Ltd. Li Hong, Xu Juan
Rd., Pudong New Area, December 2023
Shanghai
Financial consultant engaged by the Company for performing continuous supervision duties in reporting period
□Applicable Not applicable
VI. Main accounting data and financial indexes
Whether it has retroactive adjustment or re-statement on previous accounting data or not
□Yes No
Changes in the current
2022 2021 year over the previous 2020
year (+,-)
Operation
444,762,238.25 165,246,577.95 169.15% 117,857,480.17
revenue(RMB)
Net profit attributable -7,616,378.75 -1,986,692.82 -283.37% 3,785,834.68
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to shareholders of the
listed company (RMB)
Net profit attributable
to shareholders of the
listed company after
-7,644,167.31 -4,548,872.83 -68.05% 3,071,751.90
deducting non-
recurring gains and
losses(RMB)
Net cash flow arising
from operating -261,419,066.03 15,673,932.87 -1,767.86% 3,942,228.96
activities(RMB)
Basic
-0.013 -0.004 -225.00% 0.0069
EPS(RMB/Share)
Diluted
-0.013 -0.004 -225.00% 0.0069
EPS(RMB/Share)
Weighted average ROE -14.30% -20.04% 5.74% 42.01%
Changes at end of the
current year compared
Year-end of 2022 Year-end of 2021 Year-end of 2020
with the end of
previous year (+,-)
Total assets(RMB) 397,253,487.93 97,363,437.22 308.01% 91,742,769.99
Net assets attributable
to shareholder of listed 290,129,318.51 8,918,538.16 3,153.10% 10,905,230.98
company (RMB)
The lower of the company’s net profit before or after deduction of non-recurring profit (gain)/loss for the last three financial years
is negative, and the audit report for the latest year indicates that there is uncertainty about the company’s ability to continue as a
going concern
□Yes No
The lower of the net profit before or after deduction of non-recurring profit (gain)/loss is negative
□Yes No
VII. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□Applicable Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either IAS (International
Accounting Standards) or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
2. Difference of the net profit and net assets disclosed in financial report, under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□Applicable Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign accounting rules or
Chinese GAAP (Generally Accepted Accounting Principles) in the period.
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VIII. Quarterly main financial index
Unit: RMB/CNY
Q1 Q2 Q3 Q4
Operation revenue 50,246,951.40 56,418,495.18 42,497,879.73 295,598,911.94
Net profit attributable
to shareholders of the -903,991.16 -579,373.26 2,695,178.23 -8,828,192.56
listed company
Net profit attributable
to shareholders of the
listed company after
-1,190,923.81 -1,084,990.33 2,327,827.29 -7,696,080.46
deducting non-
recurring gains and
losses
Net cash flow arising
from operating -8,930,326.51 -349,150.01 -5,918,237.69 -246,221,351.82
activities
Whether there are significant differences between the above-mentioned financial index or its total number and the relevant
financial index disclosed in the company’s quarterly report and semi-annual report
□Yes No
IX. Items and amounts of extraordinary(non-recurring) profit (gains)/loss
□Applicable Not applicable
The Company has no non-recurring gain/loss in the reporting period
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Section III Management Discussion and Analysis
I. Industry of the Company during the reporting period
The Company shall comply with the disclosure requirement of jewelry-related industries in the “Shenzhen Stock Exchange Self-
Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”
(1) Industry development
China is one of the most important jewelry producer and consumer in the world at present. With the growth of national economy and
the accumulation of residents' wealth, people gradually increase their consumption of high-end consumer goods after meeting the
basic living needs. Jewelry with the property of preserving value and showing personality has become the consumption hotspots of
Chinese residents. At the same time, with the rise of young consumers and emerging middle class, the demand for quality personal
consumption is gradually upgrading, and the young generation's consumption of jewelry tends to be more routine, which can improve
the repurchase rate of jewelry products under various occasions, providing greater development space for the jewelry industry.
Jewelry can be divided into gold, diamond, jade, colored jewelry and others. Under the background of China’s cultural tradition of
advocating gold jewelry and the Investment real estate of gold, gold products occupies a relatively high proportion in the domestic
jewelry market in 2022, reaching 57.02%. Diamond and jade are also the main categories of jewelry in China, accounting for 11.40%
and 20.45%. From the international market, the jewelry markets of developed countries such as the United States, Japan, and Europe
are all dominated by diamond jewelry. Compared with the international market, the main categories of China’s jewelry market are
more abundant, and the proportion of various jewelry markets is more balanced, the categories of products are more rich.
In 2022, China's consumer market continued to maintain its recovery momentum and remain resilient. According to the data of the
National Bureau of Statistics, in 2022, the total retail sales of consumer goods reached 43.97 trillion yuan, among which, the retail
sales of gold, silver and jewelry by units above the quota reached 301.4 billion yuan, and the total retail sales remained above 300
billion yuan. According to the 2022 China Jewelry Industry Development Report" released by GEMS & Jewelry Trade Association of
China, in terms of sales volume, China's jewelry and jade jewelry industry market scale was about 719 billion yuan in 2022, which
basically remained unchanged from the previous year. The market scale of gold products was about 410 billion yuan, and the market
scale of diamond products was about 82 billion yuan. China has been the world's largest gold consumer since 2013. According to
historical data, from 1992 to 2022, the average annual growth rate of China's demand for gold jewelry was 5%. In 2022, the Chinese
market accounted for more than 27% of the total global demand for gold jewelry.
(2) Industry development trend analysis
1. The increased industry concentration has become the mainstream trend
For the past few years, consumers’ brand awareness has been increasing. In addition, at the end of 2014, the National Jewelry
Standards Technical Committee revised the mandatory national standard “Regulations on the Purity of Precious Metals in Jewelry
and Naming” (GB11887-2012), which deleted the “pure gold” and other titles, guided consumers to pay more attention to jewelry
design, craftsmanship, style and brand value, and no longer be attracted by the words “pure gold” in the slogan and pay more
attention to product quality, prompting small jewelry enterprises to move closer to large jewelry enterprises. The increasing
concentration of the jewelry industry has become the mainstream trend. In contrast, some regional branded or unbranded small
jewelry companies are at a disadvantage in terms of scale, capital, cost, etc., coupled with their own lack of ability in brand operation
management, product marketing design, and enterprise operation, in the case of consumers paying more and more attention to brand,
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they will have to choose to rely on the development of jewelry brands with larger brand awareness, which will further promote the
improvement of the industry concentration, and the national jewelry brands will gain an opportunity for vigorous development.
2. The development trend of industrial clustering is more obvious
The cluster development of the jewelry industry has now become an important direction for China's jewelry industry to improve its
comprehensive competitiveness and promote the extension and upgrade of the characteristic industry chain of the regional jewelry.
At present, there are more than ten jewelry industry bases in China, all of which have distinctive characteristics and outstanding
advantages. Whether it is pearl cultivation, jade carving or jewelry processing, they all add charm to the city and also bring vitality to
the prosperity of the jewelry industry. Special jewelry industry bases such as Shenzhen Luohu, Guangzhou Panyu mainly focus on
precious metal jewelry inlay processing, diamond cutting, and supporting products, forming a series of leading enterprises and many
small and medium-sized enterprises. At the same time, with the strong support of the local government, the supporting system such
as logistics services, information services and technical services have been continuously improved.
3. The Third- and fourth-tier cities become important consumer markets for the jewelry industry
In recent years, the pace of urbanization in China has gradually accelerated, and the urbanization rate has continued to grow.
Residents in rural areas are gradually relocating and settling in nearby third- and fourth-tier cities, which steadily deliver new vitality
to the third- and fourth-tier cities. In the future, the third- and fourth-tier cities will have broad market space and show huge growth
potential. With the sinking trend of the jewelry consumption market, the third- and fourth-tier cities will become the main markets
for the growth of jewelry companies in the future.
4. Channel strength will be regarded as the core competitiveness of enterprises for a long time
The internal competition in the jewelry industry is relatively large, and the fierce market competition makes the construction and
control of sales channels for jewelry companies crucial. At the same time, due to the high value of jewelry, consumers are often
worried about the quality of the product and the reasonableness of the price when purchasing, which often prompts them to purchase
through physical channels. There is a certain scarcity of high-quality physical channels, and the number of high-quality shops in a
region’s high-quality business districts is scarce. Such high-quality shops can not only provide higher traffic, improve the retail
performance of jewelry, but also have the important value of brand promotion. Therefore, in the fierce market competition, it is very
important for jewelry enterprises to control high-quality physical channels, which reflects the core competitiveness of enterprises on
the other side.
5. Brand and design capabilities will become a new driving force for the development of the industry
With the change of consumer demographic structure and the increase of per capital income, the middle and upper middle class and
wealthy people have gradually become the main force of consumption, and the mainstream consumption concept has also quietly
changed. Compared with traditional consumers, emerging consumer groups pay more attention to the design, craftsmanship, style
and brand value of jewelry products, hoping to meet their needs to show their taste and personality. In addition, the National Jewelry
Standards Technical Committee has removed titles such as “pure gold from the national standards, further prompting consumers to
pay attention to the design, craftsmanship, style and brand value of jewelry, rather than overemphasizing purity.
6. There is large space for improving the penetration rate of diamond jewelry
In China, different jewellery products have different market maturity levels. Among them, gold jewelry has a relatively deep
foundation in Chinese culture, and it is still the main jewelry consumption type so far. The diamond jewelry is small in volume but is
growing rapidly, and has a broad space for industry development in the future. With the further reduction of diamond inventory and
promotion of the resume dynamic between international contact and trading cooperation, China’s diamond imports and consumption
is expected to recover rapidly.
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7. The rapid development of e-commerce market creates omni-channel marketing model
The Internet has provided more convenient and more widely spread way of information sharing, guiding the consumers' demands and
choices. In recent years, jewelry retail enterprises have further strengthened online layout, built new media matrix through various
social communication platforms, formed multi-channel customer sources, realized rapid spread of online brands and drainage and
sales of offline stores, and created a new mode of omni-channel marketing. The development of sharing platforms and e-commerce
platforms has changed the consumption habits of consumers, especially the young generation.
Online consumers can more conveniently understand product features and share user experience, which has become an important
trend of product promotion and future sales. Especially with the rise of live streaming platforms of e-commerce and social contact,
the market share of live streaming e-commerce is increasing rapidly.
8. Supply chain management has become an important business method for jewelry enterprises
From the perspective of supply chain in the jewelry industry, it mainly involves raw material mining, processing and smelting, blank
processing, jewelry production, warehousing, distribution and sales. The jewelry enterprise continue to optimize their supply chain
management in order to shorten the supplying cycle and lower operating costs while guarantee the quality. More and more well-
known domestic jewelry brands have outsourced part or all of the intermediate processing links with low gross profit and large
investment over recent years, focusing on premium front-end design, brand operation and back-end marketing network construction.
Supply chain management has become a major means for jewelry enterprise to improving their operational efficiency.
(3) Competitive advantages of the company to engage in the jewelry and gold business
1. Superior quality of upstream supplier system
As things are at the moment, the company has established relatively stable cooperative relationships with major diamond suppliers
and processors at home and abroad, and has advantages in raw material procurement cost, order production cycle and product quality
control, which can continuously reduce supply cost and improve operational efficiency.
2. Diversified downstream market channels and customer resources
The company is actively expanding its gold jewelry customers now. In addition to customers with clear orders, it is currently
negotiating business cooperation with a number of domestic jewelry brands. The above customers include three types of customers,
of which Class A customers are national well-known brand customers, with more than 500 retail stores; Class B customers are small
and medium-sized/regional/segmented brands, with 300-500 retail stores; Class C customers are small and medium-sized brands,
with 50-100 retail stores.
3. Improve the industrial chain of production and design
The company has a one-stop industrial chain of design, production, processing, testing, and wholesale. Brand owners can rely on our
jewelry processing resources to hand over lower value-added links such as manufacturing and distribution to the company, so as to
focus on the higher value-added brand operation and sales links. Outsourcing in the production and design process can improve the
homogenization of gold jewelry products.
4. Closed-loop business process and risk control system
The company has formulated strict business internal control processes such as supplier admittance standards, customer evaluation
system, full-process order tracking system, and procurement price comparison system, and has realized the closed-loop control of
capital flow, information flow and logistics and the multi-level risk control through the integrated service platform of supply system
and the integrated solution of capital management.
In the bicycle and new-energy lithium battery materials industry, as a traditional manufacturing industry, the bicycle industry
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continues the dilemma of rising labor costs, manufacturing costs, capital costs, and material costs. The new national standard of
safety technical specifications for electric bicycles implemented in April 2019 accelerated the industry reshuffle and formed a new
round of industry shock. The market share showed a trend of concentration to large-scale enterprises, leading enterprises and brand
enterprises, and the industry order was accelerated and optimized, and the market concentration degree was continuously improved.
China is the world's largest country in the production and sales of electric bicycles. After years of development, electric bicycles have
gradually become an important means of transportation for consumers' daily short-distance trips. At present, there are about 200
million vehicles in the whole society. Under the macro background of economic transformation, information technology and carbon
dioxide emission and carbon neutrality policy, the consumer market of two-wheeled electric vehicles gradually presents three trends,
namely the consumption upgrading and personalized consumption demand, the consumer awareness of environmental protection,
and the consumer pursuit of convenience and intelligence. Structural body, motor, power battery, and control system, as the core
components of electric bicycles, Shenzhen China Bicycle has closely followed up and studied their technological development,
application development and commercial value for a long time, and determined the list of qualified suppliers for core components
year by year. As one of the core components of electric bicycle, lead-acid batteries have been mainly used as the power batteries in
the past ten or twenty years. With the development and popularization of new energy technologies and new energy materials, it is
expected that they will be replaced by lithium batteries on a large scale in the future. The implementation of the new national
standards for safety technical specifications of electric bicycle has comprehensively improved the safety performance of electric
bicycles, adjusted and improved technical indicators such as speed limit, vehicle quality, and pedaling ability. The new standards that
are close to the people's livelihood and serve the people's livelihood have increased the application space of lithium battery energy
storage, and lithium battery electric bicycles will usher in a new stage of development.
II. Main businesses of the Company during the reporting period
The Company shall comply with the disclosure requirement of jewelry-related industries in the “Shenzhen Stock Exchange Self-
Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”
During the reporting period, the company mainly engaged in jewelry gold business, bicycle and new-energy lithium battery material
business: (1) Gold jewelry business -The company connected with downstream gold jewelry brands, purchased gold and diamonds
according to their product needs, and then entrusted gold jewelry processing plants for processing, and delivered the inspected and
qualified finished products to downstream customers after making product certificate for them. Through the integration of upstream
supplier resources and downstream customer resources, the turnover speed of gold jewelry products in upstream and downstream has
been improved, the cost of circulation has been reduced, and the overall competitive advantage of upstream and downstream has
formed. (2) Bicycle and new-energy lithium battery material business includes production, assembly, procurement, and sales of
bicycles and electric bicycles, and procurement, sales, and consigned processing of lithium batteries materials, etc.
As the operation revenue from jewelry-related business for year of 2022 accounts for more than 30% of the Company’s audited
operation revenue for the most recent fiscal year, the Company is required to comply with the disclosure requirement of jewelry-
related industries in the “Shenzhen Stock Exchange Self-Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”,
specific disclosures are as follow:
(1) Main business models during the reporting period
1. Sales model
According to the annual order planning and regular procurement requirements of brand retailers, the company provided B-end
customers with various forms of supply chain management services such as spot procurement, order production, and customized
development, so as to minimize product inventory and improve the supply chain effectiveness for customers.
Spot procurement: Organized the goods through the integration of upstream factories and exhibition halls and suppliers' product
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styles and spot resources, and provided corresponding product structure according to the customer's brand characteristics and
terminal market needs;
Order production: Customers placed orders to the company according to their own needs, and the company purchased raw materials
and subcontracted processing to form finished products and sell them to customers;
Customized development: According to the characteristics of their own brands and future development needs, customers entrusted
the company to develop and design the product styles, and produce finished products to sell to customers.
2.Procurement model
The upstream raw material suppliers of the company’s gold jewelry supply chain business were mainly diamonds and gold, of which
the diamond suppliers were mainly source producers or wholesalers from India or Hong Kong, and domestic mature diamond
wholesalers (generally members of the Shanghai Diamond Exchange) ), gold was mainly purchased from the Shanghai Gold
Exchange through the company's membership qualifications at Shanghai Gold Exchange. The company has established professional
procurement department and team to be responsible for the procurement of diamond products and jewellery. The specific
procurement models varied according to customer needs.
3. Production model
By integrating upstream commissioned processing plants, the company outsourced the production of products ordered by customers
to professional jewelry manufacturers to give full play to their professional and scale effect. In view of the current situation and
characteristics of domestic jewelry processing enterprises, the company established a set of effective supplier management
mechanisms and evaluation standards to achieve a benign interaction between the production system of outsourced manufacturers
and the company's business development.
(2) Operation of the physical store during the reporting period
During the reporting period, gold and jewelry business of the Company mainly provides supply chain management and services in
the vertical field of gold and jewelry, it connects with the downstream gold jewelry brand and does not have the physical stores.
(3) Operation of the on-line sales in reporting period
The Company does not have on-line sales in the Period
(4) Inventory in the reporting period
Unit: RMB/CNY
Item Types Amount Proportion
Finished goods Jewelry 1,607,746.86 3.42%
Gold jewelry 21,711,885.06 46.12%
Other 2,287.90 0.00%
Total 23,321,919.82 49.55%
Raw materials Gold 21,309,167.26 45.27%
Platinum - -
Diamond 1,259,273.89 2.68%
Total 22,568,441.15 47.94%
Wrappage 105,670.36 0.22%
Goods in process 1,075,997.14 2.29%
Total 47,072,028.47 100.00%
III. Core Competitiveness Analysis
In 2022, based on its own poor economic conditions after the reorganization, the company continued to adhere to the business of
bicycle and electric bicycles, strive to carry out new product research and development, and carried out online and offline sales and
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brand management; Meanwhile, based on the long-term process of the electric bicycle business, correspondingly carried out follow-
up research on related industrial projects and technical applications in the upstream and downstream of the industrial chain. On the
basis of extensive commercial contacts and previous businesses, the company continued to follow the new energy development and
conduct business. On the one hand, the company continued to promote the jewelry and gold business to expand business dimension.
In August 2019, the Company and Shenzhen Zuankinson Jewelry Co., Ltd jointly established a Shenzhen Xinsen Jewelry Gold
Supply Chain Co., Ltd with contribution of 6.5 million yuan. Of which, the Company holds 65% equity, and is the controlling
shareholder of Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd, while 35% equity held by Zuankinson Jewelry. In the first
half of 2020, the investment parties increased the capital to Xinsen Company in the same proportion to 20 million yuan; In August
2020, the two investment parties signed another capital increase contract to increasing the capital to Xinsen Company in the same
proportion, the registered capital increased to 200 million yuan from 20 million yuan. Among them, the company has contributed 117
million yuan, which will be invested one after another according to the self-owned funds and funds raised from the non-public
offering of A shares. On the other hand, making more efforts to promote the selection of restructuring party and planning for the
non-public offering of shares in the hope of improving the business strength and development momentum of the Company.
From October to November 2022, the company successfully made a non-public offering of 138 million shares, raising funds of 294
million yuan, all of which is to be used to supplement the working capital after deducting issuance expenses. Through internal
development, jewelry and gold business has gradually become the core business of the company. Competitive advantages of the
company in jewelry and gold business:
1. High-quality upstream supplier system
At present, the company has established stable cooperative relations with major diamond suppliers and processors at home and
abroad, and has advantages in raw material purchase cost, order production cycle and product quality control, which can
continuously reduce the supply cost and operation efficiency.
2. Diversified downstream market channels and customer resources
At present, the company is actively developing gold and jewelry customers. In addition to customers placed orders, the company is
negotiating business cooperation with many domestic jewelry brands. There are three types of customers, type A customers are
national well-known brand customers with more than 500 retail stores; type B customers are small and medium-
sized/regional/segmented brands with 300-500 retail stores; type C customers are small and medium-sized brands with 50-100 retail
stores.
3. Industrial chain improvement of production and design links
The company has an industrial chain process coordinating design, production, processing, inspection and wholesale. Brand owners
can rely on our jewelry processing resource advantages and hand over low value-added links such as manufacturing and distribution
to the company, so as to focus on the brand operation and sales links with higher added value. Outsourcing of production and design
can improve the homogeneity of gold and jewelry products.
4. Closed-loop business process and risk control system
The company has developed strict internal business control processes such as supplier admittance criterion, customer evaluation
system, whole-process order tracking system and purchase price comparison system. Through integrated service platform of supply
system and integrated solution of fund management, the company has realized closed-loop control of capital flow, information flow
and logistics, and realized multi-level risk control.
16
IV. Main business analysis
1. Overview
In 2022, based on its own poor economic conditions after the reorganization, the company continued to adhere to the business of
bicycle and electric bicycles, strive to carry out new product research and development, and carried out online and offline sales and
brand management; Meanwhile, based on the long-term process of the electric bicycle business, correspondingly carried out follow-
up research on related industrial projects and technical applications in the upstream and downstream of the industrial chain. On the
basis of extensive commercial contacts and previous businesses, the company continued to follow the new energy development and
conduct business. On the one hand, the company continued to promote the jewelry and gold business to expand business dimension.
In August 2019, the Company and Shenzhen Zuankinson Jewelry Co., Ltd jointly established a Shenzhen Xinsen Jewelry Gold
Supply Chain Co., Ltd with contribution of 6.5 million yuan. Of which, the Company holds 65% equity, and is the controlling
shareholder of Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd, while 35% equity held by Zuankinson Jewelry. In the first
half of 2020, the investment parties increased the capital to Xinsen Company in the same proportion to 20 million yuan; In August
2020, the two investment parties signed another capital increase contract to increasing the capital to Xinsen Company in the same
proportion, the registered capital increased to 200 million yuan from 20 million yuan. Among them, the company has contributed 117
million yuan, which will be invested one after another according to the self-owned funds and funds raised from the non-public
offering of A shares. On the other hand, making more efforts to promote the selection of restructuring party and planning for the
non-public offering of shares in the hope of improving the business strength and development momentum of the Company.
From October to November 2022, the company successfully made a non-public offering of 138 million shares, raising funds of 294
million yuan, all of which is to be used to supplement the working capital after deducting issuance expenses. Share capital of the
Company increased to 689 million yuan and completed the general election of Board. Wansheng Industrial Holdings (Shenzhen) Co.,
Ltd comes to the controlling shareholder of the Company and Mr. Wang Shenghong is the actual controller of the Company
The fund raised this time should be mainly used to supplement the working capital for the development of jewelry and gold business.
Through internal development, jewelry and gold business has gradually become the core business of the company. After the raised
fund was fully funded in the fourth quarter of 2022, the company further planned to expand the jewelry and gold business, and
further planned to develop the bicycle, electric bicycle and new energy lithium battery material business. Through various efforts, the
company achieved an operating revenue of 444.76 million yuan in 2022, with a significant increase in both revenue and gross profit
compared with the same period last year. In addition, as the business condition of Guangshui Jiaxu Company, one customer of the
company's lithium battery material business, turned bad and stopped production, the company increased the provision for bad debts
of its accounts receivable of 21.86 million yuan, resulting in a loss this year, and the net profit attributable to the shareholders of the
listed company in 2022 was -7.62 million yuan.
2. Revenue(income) and cost
(1) Constitute of operation revenue
Unit: RMB/CNY
2022 2021
Y-o-y changes (+,-
Ratio in operation Ratio in operation )
Amount Amount
revenue revenue
17
Total operation
444,762,238.25 100% 165,246,577.95 100% 169.15%
revenue
According to industries
Sales of bicycles
4,778,433.29 1.07% 9,629,736.29 5.83% -50.38%
and spare parts
Lithium battery
12,258,681.61 2.76% 19,745,299.24 11.95% -37.92%
material
Jewelry and gold 427,725,123.35 96.17% 132,915,435.90 80.43% 221.80%
Other 2,956,106.52 1.79%
According to products
Sales of bicycles
4,778,433.29 1.07% 9,629,736.29 5.83% -50.38%
and spare parts
Lithium battery
12,258,681.61 2.76% 19,745,299.24 11.95% -37.92%
material
Jewelry and gold 427,725,123.35 96.17% 132,915,435.90 80.43% 221.80%
Other 2,956,106.52 1.79%
According to region
Domestic 444,762,238.25 100.00% 165,246,577.95 100.00% 169.15%
According to sale model
Direct sales 444,762,238.25 100.00% 165,246,577.95 100.00% 169.15%
(2) Industries, products, regions and sales model that account for more than 10% of the operating revenue or operating
profit of the Company
Applicable □Not applicable
Unit: RMB/CNY
Change of
Change of Change of
Operation Gross profit operation
Operation cost operation cost gross profit
revenue ratio revenue y-o-
y-o-y(+,-) ratio y-o-y(+,-)
y(+,-)
According to industries
Sales of
bicycles and 4,778,433.29 1,485,365.25 68.92% -50.38% -71.20% 22.47%
spare parts
Lithium
battery 12,258,681.61 12,117,531.87 1.15% -37.92% -38.44% 0.84%
material
Jewelry and
427,725,123.35 403,281,856.05 5.71% 221.80% 222.79% -0.29%
gold
Other
According to products
Sales of
bicycles and 4,778,433.29 1,485,365.25 68.92% -50.38% -71.20% 22.47%
spare parts
Lithium
battery 12,258,681.61 12,117,531.87 1.15% -37.92% -38.44% 0.84%
material
Jewelry and
427,725,123.35 403,281,856.05 5.71% 221.80% 222.79% -0.29%
gold
Other
According to region
Domestic 444,762,238.25 416,884,753.17 6.27% 169.15% 173.18% 1.38%
18
According to sale model
Direct sales 444,762,238.25 416,884,753.17 6.27% 169.15% 173.18% 1.38%
Under circumstances of adjustment in reporting period for statistic scope of main business data, adjusted main business based on
latest one year’s scope of period-end
□Applicable Not applicable
(3) Income from physical sales larger than income from labors
Yes □No
Y-o-y changes (+,-
Industries Item Unit 2022 2021
)
Sales volume In 10 thousand 6.32 10.83 -41.64%
Bicycle, electric Output In 10 thousand 10.83
bicycle Inventory In 10 thousand 6.32 0.02
Sales volume Ton 152.59913 538.38666 -71.66%
Lithium battery Output
material Inventory 9.6278
Purchasing volume Ton 162.22693 538.38666 -69.87%
Sales volume 10,000 sets 603 1,930 -68.76%
Lithium battery Output
material Inventory
Purchasing volume 10,000 sets 603 1,930 -68.76%
Sales volume 10,000 M2 40 136.3 -70.65%
Lithium battery Output
material Inventory
Purchasing volume 10,000 M2 40 136.3 -70.65%
Sales volume In 10 thousand 31.04 34.585 -10.25%
Lithium battery Output
material Inventory
Purchasing volume In 10 thousand 31.04 34.585 -10.25%
Sales volume Piece 42,270 73,628 -42.59%
Output
Jewelry and gold
Inventory Piece 2,137 3,803 -43.81%
Purchasing volume Piece 40,604 74,412 -45.43%
Reasons for y-o-y relevant data with over 30% changes
Applicable □Not applicable
1.Decline of the electric vehicle lithium battery material business and down in physical sales;
2. Growth of the jewelry and gold business, the physical sales goes up.
(4) Performance of significant sales contracts, major procurement contract entered into by the company
up to the current reporting period
□Applicable Not applicable
(5) Constitute of operation cost
Classification of industries
Unit: RMB/CNY
19
2022 2021
Ratio in Y-o-y changes
Industries Item Ratio in
Amount Amount operation (+,-)
operation cost
cost
Sales of Sales of
bicycles and bicycles and 4,778,433.29 0.36% 5,156,724.06 3.38% -71.20%
spare parts spare parts
Lithium
Lithium battery
battery 12,117,531.87 2.90% 19,684,264.57 12.90% -38.44%
material
material
Jewelry and Jewelry and
403,281,856.05 96.74% 124,935,947.83 81.87% 227.79%
gold gold
Other IT business 0 0 2,830,050.13 1.85%
Explanation
Nil
(6) Whether the changes in the scope of consolidation in Reporting Period
□Yes No
(7) Major changes or adjustment in business, product or service of the Company in Reporting Period
□Applicable Not applicable
(8) Major sales and main suppliers
Major sales client of the Company
Total top five clients in sales (RMB) 337,536,027.69
Proportion in total annual sales volume for top five clients 75.89%
Ratio of related parties in annual total sales among the top five
21.77%
clients
Information of top five clients of the Company
Proportion in total annual
Serial Name Sales (RMB)
sales
1 Client 1 126,045,889.28 28.34%
2 Client 2 96,810,724.94 21.77%
3 Client 3 45,015,802.21 10.12%
4 Client 4 43,576,834.56 5.87%
5 Client 5 26,086,776.71 9.80%
Total -- 337,536,027.70 75.89%
Other notes of main clients
□Applicable Not applicable
Main suppliers of the Company
Total purchase amount from top five suppliers (RMB) 43,385,829,361.06
Proportion in total annual purchase amount for top five
94.98%
suppliers
Ratio of related parties in annual total sales among the top five
0.00%
suppliers
20
Information of top five suppliers of the Company
Proportion in total annual
Serial Name Purchase (RMB)
purchase
1 Shanghai Gold Exchange 279,994,024.80 61.30%
2 Supplier 2 105,239,983.50 23.04%
3 Supplier 3 40,948,456.55 8.96%
4 Supplier 4 4,312,416.64 0.94%
5 Supplier 5 3,363,412.17 0.74%
Total -- 433,858,293.66 94.98%
Other notes of main suppliers
Applicable □Not applicable
Shanghai Gold Exchange is the only legal trading market of precious metals in China. The gold materials required during the
reporting period were mainly purchased through Shanghai Gold Exchange, and there is no affiliation between the Company and
top five suppliers.
3. Expenses
Unit: RMB/CNY
2022 2021 Y-o-y changes (+,-) Note of major changes
The sale expenses
Sales expenses 5,688,257.68 3,303,956.30 72.17% increased due to the
growth of revenue
Administrative
7,525,176.16 6,154,605.29 22.27%
expenses
Financial expenses -196,347.38 10,640.11 -1,945.35%
R&D expenses 924,567.70 2,037,197.58 -54.62%
4. R&D investment
Applicable □Not applicable
Estimated Impact on
Name of Main R&D
Project Purpose Project Progress Goal to Achieve the Company's Future
Projects
Development
The technical level and
quality level of electric Improving the drum
Research and vehicle products have brake control
development on drum great improvement. Improve the drum performance of electric
brake control Improving the drum Completed check brake control vehicles to improve
technology of electric brake control before acceptance performance of electric customer experience
vehicles with heat performance of electric vehicles and create more
radiation structure vehicles can further revenue for the
improve the company.
performance of electric
21
vehicle products.
Improving the safety
Research and
performance of electric
development on Prevent battery leakage Further improve the
vehicle products to
leakage protection of electric vehicles, and Completed check leakage protection
ensure the safety of
technology of the strengthen the safety of before acceptance effect of the battery of
customers and create
battery of U-shaped electric vehicles electric vehicles
more revenue for the
electric vehicles
company.
Improving the
The special
Research and component force and
environment of
development on shock-absorbing ability
mountain has high Further improve the
component force and Completed check of mountain bikes to
requirements for overall performance of
shock-absorbing before acceptance improve customer
mountain bike in mountain bikes
technology of experience and create
component force and
mountain bike more revenue for the
shock-absorbing
company.
A professional
Improving the safety
mountain bike is often
Research and performance of
ridden on the
development on anti- mountain bikes to
mountains, the bike Avoid the rear wheel to
detachment variable Completed check ensure the safety of
keeps bouncing during fall off, ensure the
speed technology of before acceptance customers and riders
riding, so that the rear safety of rider
rear wheel of mountain and create more
wheel is easy to fall off
bike revenue for the
from the slot, causing
company.
injury to the rider
Improving the anti-
It solves the problem shock performance of
Research and
that lead-acid batteries Improve the strength of the batteries of electric
development on anti-
with graphene the graphene composite bicycles to increase the
shock technology of Completed check
composite electrodes electrode by the battery life, improve
graphene lead-acid before acceptance
are difficult to apply to improvement of battery customer experience
batteries for electric
electric bicycles due to case and create more
bicycles
collisions revenue for the
company.
Improving the anti-
Research and Anti-theft design for theft performance of
development on anti- hydraulic disc brake Improve the anti-theft mountain bikes to
Completed check
theft technology of effectively protects the performance of improve customer
before acceptance
hydraulic disc brake of safety of hydraulic disc mountain bikes experience and create
mountain bikes brake more revenue for the
company.
Research and The gems need to be Replacement of manual Improve the efficiency
Under check before
development on pressed after inlaying pressing in the jewelry of jewelry inlaying,
acceptance
jewelry inlay and to improve the strength pressing and inlaying save the production
22
pressing technology of inlaying and the process can closely fit cost of jewelry,
adhesion degree of the jewelry and bracket improve the company's
glue, which requires profit
manual pressing. This
process increases the
labor intensity of
workers and affects the
overall processing
efficiency due to the
instability of workers'
force
Personnel of R&D
2022 2021 Change ratio(+,-)
Number of R&D (people) 14 19 -26.32%
Ratio of number of R&D 22.22% 31.15% -8.93%
Educational background
Undergraduate 7 6 66.67%
Master 0 0 0%
Below bachelor’s degree 7 13 -46.15%%
Age composition
Under 30 2 2 -
30~40 4 1 400.00%
Over 40 8 16 -50%
Investment of R&D
2022 2021 Change ratio(+,-)
R&D investment (RMB) 924,576.70 2,037,197.58 -54.62%
R&D investment/Operation
0.21% 1.23% -1.02%
revenue
Capitalization of R&D
0.00 0.00 0.00%
investment (RMB)
Capitalization of R&D
0.00% 0.00% 0.00%
investment/R&D investment
Reasons and effects of significant changes in composition of the R&D personnel
□Applicable Not applicable
The reason of great changes in the proportion of total R&D investment accounted for operation revenue than last year
□Applicable Not applicable
Reason for the great change in R&D investment capitalization rate and rational description
□Applicable Not applicable
5. Cash flow
Unit: RMB/CNY
23
Item 2022 2021 Y-o-y changes (+,-)
Subtotal of cash in-flow
arising from operation 290,169,218.26 208,259,853.20 39.33%
activity
Subtotal of cash out-flow
arising from operation 551,588,284.29 192,585,920.33 186.41%
activity
Net cash flow arising from
-261,419,066.03 15,673,932.87 -1,767.86%
operating activities
Subtotal of cash in-flow
arising from investment 50,000.00 100.00%
activity
Subtotal of cash out-flow
arising from investment 40,164.10 18,890.56 112.61%
activity
Net cash flow arising from
9,835.90 -18,890.56 -152.07%
investment activities
Subtotal of cash in-flow
arising from financing 299,292,780.18
activity
Subtotal of cash out-flow
arising from financing 20,207,638.62 2,296,062.44 780.10%
activity
Net cash flow arising from
279,085,141.56 -2,296,062.44 -12,254.95%
financing activities
Net increased amount of cash
17,675,911.43 13,358,979.87 32.31%
and cash equivalent
Main reasons for y-o-y major changes in aspect of relevant data
Applicable □Not applicable
Mainly due to the funding of private placement in the Period, business expansion and return of sales.
Reasons of major difference between the cash flow of operation activity in report period and net profit of the Company
Applicable □Not applicable
Mainly due to the business expansion during the Period.
V. Analysis of the non-main business
□Applicable Not applicable
VI. Analysis of assets and liability
1. Major changes of assets composition
Unit: RMB/CNY
Year-end of 2022 Year-begin of 2022
Ratio Note of major
Ratio in total Ratio in total changes(+,-) changes
Amount Amount
assets assets
24
Mainly due to
the jewelry &
gold business
that with the
replenishment
Monetary fund 54,699,491.18 13.77% 33,246,957.92 34.15% -20.38%
of working
capital from
non-public
offering in the
Period
Mainly due to
the jewelry &
gold business
that with the
Account replenishment
250,069,301.93 62.95% 46,850,083.59 48.12% 14.83%
receivable of working
capital from
non-public
offering in the
Period
Inventory 48,206,866.81 12.14% 8,248,573.77 8.47% 3.67%
Fix assets 2,304,402.38 0.58% 3,439,212.00 3.53% -2.95%
Right-of-use
173,936.71 0.04% 1,505,258.90 1.55% -1.51%
assets
Contractual
791,762.84 0.20% 124,328.07 0.13% 0.07%
liability
Lease liability 228,302.37 0.23% -0.23%
Foreign assets account for a relatively high proportion
□Applicable Not applicable
2. Assets and liability measured by fair value
□Applicable Not applicable
3. The assets rights restricted till end of the period
1.Among the closing monetary funds, there has 3,776,621.83 yuan bank deposits were judicially frozen due to case litigation.
2. At the end of the current period, the total fixed output value included six suites of house properties at Lianxin JiaYuan, Luohu
District, Shenzhen purchased in 2016, with original value of 2,959,824.00 Yuan, which were affordable housing purchased from the
Housing and Construction Bureau of Luohu District to provide to enterprise talents for living. The contract stipulated that the
purchasing enterprise is not allowed to conduct any form of property rights transaction with any units or individual other than the
government.
VII. Investment analysis
1. Overall situation
□Applicable Not applicable
25
2. The major equity investment obtained in the reporting period
□Applicable Not applicable
3. The major non-equity investment doing in the reporting period
□Applicable Not applicable
4. Financial assets investment
(1) Securities investment
□Applicable Not applicable
The company had no securities investment in the Period.
(2) Derivative investment
□Applicable Not applicable
The Company had no derivatives investment in the Period
5. Application of raised proceeds
Applicable □Not applicable
(1) General application of raised proceeds
Applicable □Not applicable
Unit: 10,000 Yuan
Usage of
the
Cumulat retained
Total Ratio of
ive raised
Total raised cumulati Raised
Total raised Total capitals
accumul capital ve raised capitals
Raisi Total raised capitals accumul and what
ative has capitals idle for
ng Way raised capital has ative is
raised purpose has raised more
year capitals used purpose expected
capitals of uses purpose capitals than two
in Period of uses unused to
used changed of uses years
changed invested
in Period changed
in total with
those
capitals
Non-public Deposite
offering of d in
28,882.7 28,424.3 28,424.3
2022 RMB 0 0 0.00% 463.57 special 0
2 5 5
ordinary account
shares (A for fund
26
stock) raising
28,882.7 28,424.3 28,424.3
Total -- 0 0 0.00% 463.57 -- 0
2 5 5
Explanation
1.According to the Official Reply on Approval of Non-Public Offering of Shares of Shenzhen China Bicycle Company(Holdings)
Limited (ZJXK [2021] No.3552) approved by China Securities Regulatory Commission, agreed that the Company shall issue
137,836,986 RMB ordinary shares (A shares) to a specific object, Wansheng Industrial, through a private offering at 2.13 yuan a
share, with total raised funds of 293,592,780.18 yuan. After deducting the expenses of 4,765,621.08 yuan (excluding tax) related
to the issuance, the actual net funds raised amounted to 288,827,159.10 yuan. Baker Tilly China Certified Public Accountants
(LLP) has conducted an examination on the fund allocation of the company's non-public offering on October 21, 2022, and issued
the Capital Verification Report on the Fund Allocation of Non-Public Offering of A Shares of Shenzhen China Bicycle Company
(Holdings) Limited TZYZ[2022] No.42018. As of December 31, 2022, the company had raised funds of 284,243,500 yuan to
supplement the working capital, and the unused raised funds deposited in the special fund-raising account was 4,635,700
yuan(including interest income). The use of the raised funds is detailed in the following table - Conditions of Fund-Raising
Projects.
2. During the reporting period, the company neither changed the fund-raising investment projects, nor changed the location and
method of implementing the fund-raising investment projects.
3. During the reporting period, the company deposited, used and managed the raised funds in strict accordance with the Three-
party Supervision Agreement on the Deposit of Special Accounts for Raised Funds and performed relevant obligations in
accordance with relevant laws and regulations, and timely, truly, accurately and completely disclosed information related to the
use of raised funds. There is no violation of the Management System for Raised Funds and relevant laws and regulations.
(2) Committed projects of the raised proceed
Applicable □Not applicable
Unit: 10,000 Yuan
Committ
ed Cumulat
Change Investme
investme ive
the nt Date of Major
nt Total investme Achieve
project Investme progress reach a Benefit changes
projects raised- Invested nt d
(Y/N) nt after till end predeter achieved of
and fund in the amount expected
(includin adjustme of mined in the project
over- commit period till end benefits
g nt (1) period- state of Period feasibilit
raised ment of (Y/N)
partially end (3) use y (Y/N)
fund Period-
changed) ＝(2)/(1)
investme end (2)
nt
Committed investment project
Supplem
Not
ental 28,882.7 28,882.7 28,424.3 28,424.3
N 98.41% 0 applicabl N
working 2 2 5 5
e
capital
Subtotal
of
28,882.7 28,882.7 28,424.3 28,424.3
committ -- -- -- 0 -- --
2 2 5 5
ed
investme
27
nt
project
Investment of the over-raised fund
Not
applicabl
e
Payment
of bank
loans (if -- 0 0 0 0 0.00% -- -- -- --
applicabl
e)
Supplem
entary
the
working
-- 0 0 0 0 0.00% -- -- -- --
capital
(if
applicabl
e)
Subtotal
of over-
raised
-- 0 0 0 0 -- -- 0 -- --
fund
investme
nt
28,882.7 28,882.7 28,424.3 28,424.3
Total -- -- -- 0 -- --
2 2 5 5
Conditio
ns and
reasons
of
failure to
meet
schedule
or
predicte
d
income
(by
specific
projects) Not applicable
(includin
g the
reasons
for
selecting
“Not
applicabl
e ” for
“Achiev
ed
expected
benefits
(Y/N)”)
Descripti Not applicable
28
on of
major
changes
in
project
feasibilit
y
Amount,
use of
purpose
and
usage
Not applicable
progress
of the
excessiv
e raised
fund
Change
of the
impleme
ntation
location
of
Not applicable
project
with
investme
nt of
raised
fund
Adjustm
ent of
the
impleme
ntation
ways of
Not applicable
project
with
investme
nt of
raised
fund
Early
investme
nt and
replacem
Not applicable
ent with
the
raised
fund
Tempora
ry Not applicable
replacem
29
ent of
the
working
capital
with idle
raised
funds
Amount
and
reasons
of cash
surplus
in raised Not applicable
funds
during
impleme
nting the
project
Use
purpose
and
destinati
As of 31 December 2022, balance of previous proceeds was 4,635,700 yuan, all of which are demand deposit. The
on of the unused funds are deposited in the special account for fully supplementing the working capital.
raised
funds
un-used
Problem
s or
other
circumst
ances in
the use Not applicable
of raised
funds
and its
disclosur
e
Change of fund raised projects
□Applicable Not applicable
The Company had no change of fund raised projects in the Period
30
VIII. Sales of major assets and equity
1. Sales of major assets
□Applicable Not applicable
The Company had no major assets sold in the Period.
2. Sales of major equity
□Applicable Not applicable
IX. Analysis of main holding company and stock-jointly companies
Applicable □Not applicable
Particular about main subsidiaries and stock-jointly companies net profit over 10%
Unit: RMB/CNY
Company Main Register Operation Operation
Type Total assets Net assets Net profit
name business capital revenue profit
Shenzhen
Xinsen Supply
Jewelry Subs chain
200,000,0 456,655,37 2,711,497.4 2,539,293.1
Gold idiar business of 43,904,659.26 39,255,440.47
00 0.37 0 8
Supply y jewelry and
Chain Co., gold
Ltd
Shenzhen Distribution
Subs - -
Emmelle of bicycles 11,615,189.
idiar 5,000,000 11,104,098.26 -423,219.19 4,092,575.6 4,098,820.3
Industrial and spare 72
y 9 5
Co., Ltd. parts
Particular about subsidiaries obtained or disposed in report period
□Applicable Not applicable
Notes of holding and shareholding companies
1.The Company holds 65 percent equity of the Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd, the balance of minority
equity at period-end amounting to 14,181,927.65 Yuan.
X. Structured vehicle controlled by the Company
□Applicable Not applicable
XI. Future Development Prospects
From October to November 2022, the company successfully made a non-public offering of 138 million shares, raising funds of 294
million yuan, all of which is to be used to supplement the working capital after deducting issuance expenses. Share capital of the
Company increased to 689 million yuan and completed the general election of Board. Wansheng Industrial Holdings (Shenzhen) Co.,
Ltd comes to the controlling shareholder of the Company and Mr. Wang Shenghong is the actual controller of the Company
31
The fund raised this time should be mainly used to supplement the working capital for the development of jewelry and gold business.
Through internal development, jewelry and gold business has gradually become the core business of the company. After the raised
fund was fully funded in the fourth quarter of 2022, the company further planned to expand the jewelry and gold business, and
further planned to develop the bicycle, electric bicycle and new energy lithium battery material business.
ii. Operation plan for the new year:
On the basis of business work over the past few years, the business plan of the Company for 2023 is:
1. Continue to actively cooperate with shareholders and the board of directors to promote the reorganization of the company
2. Enhancing corporate governance, standardize operations, further reform and improve the internal operation management system,
assessment mechanism, strengthen the construction of management teams, business teams and technical teams. Perfected the
development plan of the Company.
3. In terms of gold and jewelry business, further establish supplier systems and expand customer resources, the business cooperation
between the well-known brands and listed company in particular, expanding international business, improve internal business
processes and internal control system construction, promote the construction of a supply chain system platform to improve
operational quality and efficiency, and strive to achieve greater growth in operating income.
4. In terms of bicycle business, the company negotiated and promoted the business cooperation on EMMELLE with big dealers in
order to maintain the brand and expand the national market as the goal. In terms of electric bicycles, the company organized source
control, quality coordination, transportation and improvement of after-sales service order by order in Shandong, Henan, Hebei,
Jiangsu and other key and mature regions to ensure the stability and improvement of order and business. For other regions, the
company strengthened communication and cooperation with ODM factories, utilized their existing sales network for distribution and
cooperation, and promoted the growth of order and business.
5.The company has been tracking the new energy and lithium electric new materials fields for many years. Benefiting from policy
promotion, technological progress and popularization of supporting facilities, and under the guidance of the goal of carbon peaking
and carbon neutrality, the global new energy industry has developed rapidly and the market has a sustainable growth. In 2023, the
company will further explore and make overall arrangements in the fields of new energy and new materials to seek new
breakthroughs.
6. The company continued to complete the rights and interests maintenance of the Guangshui Jiaxu lawsuit and the lawsuit
concerning the termination of the cooperation contract of the Urban Renewal and Reconstruction Project for the Second Phase of
Zhonghua Garden, and continued to cooperate with the manager to carry out assets escrow business and deal with relevant litigation,
so as to ensure the safety of assets and safeguard the rights and interests of relevant parties.
7. Strengthen the background management and office automation, and improve the support degree of background departments to
front desk business.
iii. Risks for the Company:
(1) Price fluctuation risk of major raw materials
The main raw materials of the company are gold, diamonds, etc. In recent years, affected by changes in the international and
domestic economic situation, the listed price of gold at the gold exchange fluctuates greatly. The market price of platinum is
32
generally positively correlated with the market price of gold. In the long run, the market price of diamond is in a moderate rising
trend. The selling price of the company's gold products calculated by gram is linked with the listed price of gold and platinum at the
gold exchange. If the market prices of gold, platinum, diamonds and other raw materials fall significantly during the inventory
turnover period of the company, on the one hand, the company has the risk of gross profit margin decline due to the decline in
product selling price; on the other hand, the company will also face the risk of decline in operating performance due to the provision
for inventory write down. At the same time, the rise in selling price caused by the sharp rise in the market price of raw materials such
as gold and diamonds may lead to the decrease of consumers' willingness and the decline of sales volume, thus adversely affecting
the business performance.
(2) The risk of intensifying market competition
In recent years, the jewelry market in China has been developing continuously, and the consumption demand of jewelry has been
developing in the direction of individuation and diversification. At present, China's jewelry industry has presented diversified
competitions. Excellent enterprises in the industry have formed competitive advantages in a certain segment by deeply exploring the
consumption preferences of specific groups. The market competition has gradually changed from price competition to comprehensive
competition among brand, business model, marketing channel, product design and quality, the competition tends to be fierce. In the
future development, if the company cannot continue to give full play to its advantages, there will be a risk of profitability decline due
to intensified competition in the industry.
(3) Risk of market demand decline
As an optional consumption, jewelry is especially sensitive to market demand, economic outlook and consumer preference. China
has become one of the countries with the most obvious growth in the jewelry and jade jewelry industry in the world. If the economic
growth rate declines in the future, the growth of market consumption demand may slow down accordingly, which will adversely
affect the company's business condition.
XII. Reception of research, communication and interview during the reporting period
Applicable □Not applicable
Basic situation
Reception Reception Main content and
Time Way Object index of
location type information provided
investigation
Telephone Consulting company
Individual
Jan.-Mar. 2022 The Company communicati Individual restructuring N/A
investor
on problem
Telephone
April- June Individual Inquiry progress of
The Company communicati Individual N/A
2022 investor the private placement
on
July - Telephone
Individual Inquiry litigation of
September The Company communicati Individual N/A
investor the Company
2022 on
Telephone Consulting the
October - Individual
The Company communicati Individual general election of N/A
December 2022 investor
on the Company
The investors Found more in
The on-line participated in “Investors
Operation of the
platform of the online Relations
Company and
2022-05-19 “Value On- Other Other performance Activities
progress of the
Line” (www.ir- briefing for year Sheet”(No.:
private placement
online.cn) of 2021 through 2022-001)
the internet released on
33
Juchao Website
(www.cninfo.co
m.cn) dated 19
May 2022
The investors Found more in
participated in “Investors
group reception Relations
The
day for Activities
“Interactive
investors of the The general election Sheet”(No.:
Platform for
listed of the Board and 2022-002)
2022-11-09 Investor Other Other
companies in reorganization of the released on
Relations” on
Shenzhen for Company Juchao Website
(https://ir.p5w.n
year of 2022 (www.cninfo.co
et)
through m.cn) dated 9
(https://ir.p5w.n November
et) 2022
34
Section IV Corporate Governance
I. Corporate governance of the Company
During the reporting period, the company strictly complied with the Company Law, the Securities Law, the Governance Code for
Listed Companies, the Rules for Listing Stocks of Shenzhen Stock Exchange, the Guidelines for the Self-Regulation of Listed
Companies of Shenzhen Stock Exchange No. 1 -- Standardized Operation of Listed Companies on the Main Board, and other
relevant laws and regulations, constantly improved the corporate governance structure, improved the enterprise management and
internal control system, deeply and meticulously carried out corporate governance activities, and constantly improved the corporate
governance level. The general meeting of shareholders, the board meeting and the meeting of supervisors of the company were held
in strict accordance with relevant rules and regulations, and the directors and supervisors can diligently perform their duties. During
the reporting period, the actual situation of corporate governance met the requirements of the regulatory documents on corporate
governance issued by China Securities Regulatory Commission and Shenzhen Stock Exchange.
1. Shareholders and general meeting of shareholders
The company convened and held the general meeting of shareholders in strict accordance with the Company Law, the Securities Law
and other laws and regulations, and the stipulations of the Articles of Association and the Rules of Procedure of the General Meeting
of shareholders, sent out meeting notice at the prescribed time before the general meeting of shareholders, and employed lawyers to
witness the meeting and give legal opinions on the convening and holding of the meeting and the validity of the resolution, ensured
that all shareholders, especially minority shareholders, enjoy equal status and fully exercise their rights. During the reporting period,
the company held three general meetings of shareholders and considered 11 proposals.
2. Controlling shareholders and the listed company
The company's controlling shareholders exercised their rights and undertook corresponding obligations in accordance with the law,
there was no direct or indirect interference in the company's decision-making and business activities beyond the company's general
meeting of shareholders. The company had an independent and complete operating system and independent operating ability, and
was independent and separated from the controlling shareholders, actual controllers and other enterprises controlled by them in terms
of business, personnel, assets, institutions and finance. The company's board of directors, board of supervisors and other internal
organs operated independently, and major decisions were made by the general meeting of shareholders and the board of directors in
accordance with the law.
3. Directors and the board of directors
The board of directors of the company has 9 members, including 3 independent directors. The number and composition of the board
of directors meet the relevant laws and regulations and the requirements of the Articles of Association. During the reporting period,
all directors of the company performed their duties diligently and responsibly in strict accordance with relevant laws and regulations,
the Articles of Association, Rules of Procedure of the Board of Directors and other relevant provisions, attended the board meetings
and the general meeting of shareholders on time, carefully deliberated various proposals, and ensured the standard, efficient operation
and prudent and scientific decision-making of the board of directors. In order to further improve the corporate governance structure,
the board of directors of the company has set up four special committees, namely strategy, audit, nomination, compensation and
assessment, to provide scientific and professional opinions for the decision-making of the board of directors. During the reporting
period, the board of directors held 9 meetings and deliberated 26 proposals.
4. Supervisors and the board of supervisors
35
The company's board of supervisors has 3 members, including 1 employee representative supervisor. The number and composition of
the board of supervisors meet the relevant laws and regulations and the requirements of the Articles of Association. During the
reporting period, the board of supervisors of the Company convened meetings in strict accordance with the Articles of Association,
the Rules of Procedure of the Board of Supervisors and other relevant provisions. All supervisors attended meetings on time,
earnestly performed their duties, independently and effectively exercised the right to supervise and examine the financial affairs of
the company and the legal compliance of the duties performed by directors and senior managers in a responsible attitude towards all
shareholders, supervised and expressed their opinions on major matters, related transactions and financial conditions of the company,
and effectively safeguarded the legitimate rights and interests of the company and shareholders. During the reporting period, the
board of supervisors held 6 meetings and deliberated 11 proposals.
5. Performance appraisal and incentive and constraint mechanism
The company has gradually established and improved the fair and transparent performance appraisal standards and incentive and
restraint mechanisms for directors, supervisors and senior managers, and the appointment of senior managers of the company is open
and transparent, and in line with the provisions of laws and regulations.
6. Stakeholders
The company fully respected the legitimate rights and interests of stakeholders, treated suppliers and customers in good faith,
carefully cultivated every employee, strengthened the communication and exchange among all parties, jointly promoted the
sustainable and healthy development of the company, and achieved the coordination and balance of the interests of shareholders,
employees and the society while maximizing the profits of the company.
7. Information disclosure and transparency
The company attached great importance to information disclosure and investor relationship management, strictly implemented the
Information Disclosure Management System, and designated Securities Times and http://www.cninfo.com.cn as the company's legal
information disclosure media and website, fairly treated all investors, and truly, accurately, completely and timely made information
disclosure, improved the transparency of the company, and protected the legitimate rights and interests of all shareholders.
8. Investor relations
The Company lays great stress on maintaining the good communication with investors. During the reporting period, by means of the
performance communication meeting and various means such as online group reception days for listed companies, the Company
introduce the development strategy and business development to the investors; the Company actively uses the investor relations
interactive platform as an important channel of communication with investors, especially small and medium-sized investors, and
answers investor’s questions on the platform in a timely and serious manner.
Is there any difference between the actual condition of corporate governance and relevant regulations about corporate governance for
listed company from CSRC?
□Yes No
There are no differences between the actual condition of corporate governance and relevant regulations about corporate
governance for listed company from CSRC.
36
II. Independence of the Company relative to controlling shareholder and the actual
controller in ensuring the Company’s assets, personnel, finance, organization and businesses
The company has an independent supply and marketing system, and is independent and separated from the controlling shareholders,
actual controllers and other enterprises controlled by them in terms of business, personnel, assets, institutions and finance, and has
the independent and complete business system and the ability to operate independently in the market.
1.Independent business
The company has an independent supply and marketing system, and has the ability to operate independently and directly to the
market. There is no other situation that needs to rely on the controlling shareholders for production and operation activities. There is
no horizontal competition between the company and the controlling shareholders, and the controlling shareholders do not directly or
indirectly interfere in the operation of the company.
2. Independent personnel
The company is independent of the controlling shareholders in labor, personnel and salary management. The general manager,
deputy general manager, chief financial officer, secretary of the board and other senior executives of the company neither hold other
positions except directors and supervisors in the controlling shareholders, actual controllers and other enterprises controlled by them,
nor receive salary from the controlling shareholders, actual controllers and other enterprises controlled by them; The company's
directors, supervisors, general manager and other senior executives are selected through legal procedures, and there is no controlling
shareholder, any other unit, department or person violating the relevant provisions of the Articles of Association to interfere in the
appointment and removal of the company's personnel.
3. Independent assets
The company has a complete supply, production and marketing system and supporting facilities required for production and
operation, and legally owns land use rights, housing property rights, ownership of trademark and other assets related to production
and operation, and does not rely on the assets of controlling shareholders for production and operation. The company has registered,
established accounts, checked and calculated and managed all assets, and the property rights of all assets are clearly defined and the
ownership is clear.
4. Independent institutions
The company has set up necessary functional departments in line with its own characteristics, and each department operates
according to the company's management system and under the leadership of the company management. There is no confusion with
the controlling shareholders, the actual controllers and other enterprises controlled by them, and there is no subordinate relationship
with the controlling shareholders.
5. Independent finance
The company has set up an independent finance department, allocated full-time financial personnel, and established a complete
accounting system, which enable it to make financial decisions independently, possess normative financial and accounting system
and financial management system for subsidiaries. The company has independent bank accounts and pays taxes independently in
accordance with the law. There is no situation of sharing bank accounts or tax payments with the controlling shareholders.
III. Horizontal competition
□Applicable Not applicable
37
IV. In the reporting period, the Company held annual shareholders’ general meeting and
extraordinary shareholders’ general meeting
1. Annual Shareholders’ General Meeting in the reporting period
Ratio of investor
Session of meeting Type Date Date of disclosure Resolutions
participation
Refer to the
Juchao Website
(www.cninfo.com.
Annual General
AGM 11.60% 29 June 2022 30 June 2022 cn): Resolution of
Meeting of 2021
Annual General
Meeting 2021
(No.: 2022017)
Refer to the
Juchao Website
(www.cninfo.com.
First Extraordinary
Extraordinary cn): Resolution of
shareholders
shareholders 11.68% 17 October 2022 18 October 2022 First Extraordinary
general meeting
general meeting shareholders
2022
general meeting
2022 (No.:
202026)
Refer to the
Juchao Website
(www.cninfo.com.
Second
cn): Resolution of
Extraordinary Extraordinary
Second
shareholders shareholders 29.54% 28 November 2022 29 November 2022
Extraordinary
general meeting general meeting
shareholders
2022
general meeting
2022 (No.:
2022041)
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□Applicable Not applicable
V. Directors, supervisors and senior executives
1. Basic information
Amou Amou
nt of nt of Reaso
Shares Shares
Start shares shares ns for
End held at Other held at
Worki dated increas decrea increas
date of period- change period-
Name Title ng Sex Age of ed in sed in e or
office begin s end
status office this this decrea
term (Share (share) (Share
term period period se of
) )
(Share (Share shares
) )
Wang Curre Not
Chairma Mal 2022- 2025-
Shenghon ntly in 41 0 0 0 0 0 applica
n e 11-28 11-27
g office ble
Li Hai Director Curre Mal 54 2010- 2025- 0 0 0 0 0 Not
38
ntly in e 08-26 11-27 applica
office ble
Curre Not
Presiden Mal 2013- 2025-
ntly in 54 0 0 0 0 0 applica
t e 09-26 11-27
office ble
Curre Not
Mal 2017- 2025-
Director ntly in 50 0 0 0 0 0 applica
e 06-29 11-27
office ble
Sun Secretar Curre Not
Mal 2012- 2025-
Longlong y of the ntly in 50 0 0 0 0 0 applica
e 05-17 11-27
Board office ble
Curre Not
Mal 2017- 2025-
CFO ntly in 50 0 0 0 0 0 applica
e 05-22 11-27
office ble
Yao Curre Not
Mal 2010- 2025-
Zhengwa Director ntly in 48 0 0 0 0 0 applica
e 08-26 11-27
ng office ble
Curre Not
Yuan Mal 2022- 2025-
Director ntly in 44 0 0 0 0 0 applica
Kang e 11-28 11-27
office ble
Curre Not
Wang Mal 2022- 2025-
Director ntly in 69 0 0 0 0 0 applica
Guoxiang e 11-28 11-27
office ble
Indepen Curre Not
Guo Mal 2022- 2025-
dent ntly in 40 0 0 0 0 0 applica
Qiuquan e 11-28 11-27
director office ble
Indepen Curre Not
Zhan Mal 2022- 2025-
dent ntly in 41 0 0 0 0 0 applica
Qiyong e 11-28 11-27
director office ble
Indepen Curre Not
Yuan Mal 2022- 2025-
dent ntly in 44 0 0 0 0 0 applica
Qinghui e 11-28 11-27
director office ble
The
convene
Curre Not
r of the Mal 2022- 2025-
Guo Yong ntly in 48 0 0 0 0 0 applica
board of e 11-28 11-27
office ble
supervis
ors
Li Curre Not
Supervis Mal 2022- 2025-
Nianshen ntly in 39 0 0 0 0 0 applica
or e 11-28 11-27
g office ble
Staff Curre Not
Yi Mal 2022- 2025-
Supervis ntly in 53 0 0 0 0 0 applica
Wenzhi e 11-28 11-27
or office ble
Not
Yang Outgo Mal 2006- 2022-
Director 66 0 0 0 0 0 applica
Fenbo ing e 06-30 11-28
ble
Not
Outgo Mal 2010- 2022-
Cao Fang Director 49 0 0 0 0 0 applica
ing e 08-26 11-28
ble
Not
Zhong Outgo Mal 2017- 2022-
Director 59 0 0 0 0 0 applica
Hua ing e 06-29 11-28
ble
Indepen Not
Yang Outgo Fem 2017- 2022-
dent 54 0 0 0 0 0 applica
Lang ing ale 06-29 11-28
director ble
Song Indepen Outgo Mal 60 2017- 2022- 0 0 0 0 0 Not
39
Xishun dent ing e 06-29 11-28 applica
director ble
Indepen Not
Zhang Outgo Mal 2017- 2022-
dent 58 0 0 0 0 0 applica
Zhigao ing e 06-29 11-28
director ble
The
convene
Not
r of the Outgo Mal 2014- 2022-
Li Xiang 49 0 0 0 0 0 applica
board of ing e 06-27 11-28
ble
supervis
ors
Staff Not
Outgo Mal 2014- 2022-
Li Jialin Supervis 62 0 0 0 0 0 applica
ing e 05-22 11-28
or ble
Zheng Not
Supervis Outgo Mal 2011- 2022-
Zhonghua 61 5,276 0 0 0 5,276 applica
or ing e 06-27 11-28
n ble
Total -- -- -- -- -- -- 5,276 0 0 0 5,276 --
During the reporting period, whether there was any departure of directors and supervisors and dismissal of Senior executives
Yes □No
During the reporting period, the general election of the BOD and Supervisory has completed on 28 November 2022, relevant
information found more in the “Change of the Director, Supervisor and Senior Executives” in this Section
Changes of directors, supervisors and senior executives
Applicable □Not applicable
Name Position Type Date Cause
General election of
Wang Shenghong Chairman Election 2022-11-28
BOD
General election of
Yuan Kang Director Election 2022-11-28
BOD
General election of
Wang Guoxiang Director Election 2022-11-28
BOD
General election of
Guo Qiuquan Independent director Election 2022-11-28
BOD
General election of
Zhan Qiyong Independent director Election 2022-11-28
BOD
General election of
Yuan Qinghui Independent director Election 2022-11-28
BOD
The convener of the General election of
Guo Yong Election 2022-11-28
BOS BOS
General election of
Li Niansheng Supervisor Election 2022-11-28
BOS
General election of
Yi Wenzhi Staff Supervisor Election 2022-11-28
BOS
Li Hai President Engagement 2022-11-28 Re-engagement
Sun Longlong Secretary of the Board Engagement 2022-11-28 Re-engagement
Sun Longlong CFO Engagement 2022-11-28 Re-engagement
Outgoing for the office Outgoing for the office
Li Hai Chairman 2022-11-28
term expired term expired
Outgoing for the office Outgoing for the office
Yang Fenbo Director 2022-11-28
term expired term expired
Outgoing for the office Outgoing for the office
Cao Fang Director 2022-11-28
term expired term expired
40
Outgoing for the office Outgoing for the office
Zhong Hua Director 2022-11-28
term expired term expired
Outgoing for the office Outgoing for the office
Yang Lang Independent director 2022-11-28
term expired term expired
Outgoing for the office Outgoing for the office
Song Xishun Independent director 2022-11-28
term expired term expired
Outgoing for the office Outgoing for the office
Zhang Zhigao Independent director 2022-11-28
term expired term expired
The convener of the Outgoing for the office Outgoing for the office
Li Xiang 2022-11-28
BOS term expired term expired
Outgoing for the office Outgoing for the office
Zheng Zhonghuan Supervisor 2022-11-28
term expired term expired
Outgoing for the office Outgoing for the office
Li Jialin Staff Supervisor 2022-11-28
term expired term expired
2. Post-holding
Professional background, major working experience and present main responsibilities in Company of directors, supervisors and
senior executive
Mr. Wang Shenghong, born in 1982, is a Chinese national without the right of permanent residence abroad. Mr. Wang Shenghong is
currently an executive director and general manager of Wansheng Industrial Holdings (Shenzhen) Co., Ltd., an executive director and
general manager of Shenzhen Wansheng Kejiao Holding Co., Ltd., an executive director and general manager of Shenzhen Huaxia
Juanyong Cultural Tech. Co., Ltd., and the Chairman of the Company.
Mr. Li Hai, born in 1969, graduated from Economic department of Shenzhen University in major of accounting; Mr. Li took the turns
of deputy manager of finance department, assistant CFO, secretary of the Board and vice president, etc. of the Company, and now he
serves as President of the Company.
Mr. Sun Longlong, born in 1973, graduated from Shanghai University of Finance and Economics in 1995 with a bachelor degree, a
bachelor of Economics. Mr. Sun successively worked as financial affairs in Shenzhen Qiongjiao Industry Co., Ltd. and Shenzhen
Solar Pipe Co., Ltd.; he worked in the Company since May 1999, and successively served as Deputy Manager of financial
department, Manager, manager of comprehensive management department, manager of enterprise management department, now he
serves as Director, secretary of the Board and CFO of the Company.
Mr. Yao Zhengwang, born in 1975, received a Bachelor of Law degree. Mr. Yao Zhengwang is currently a director of Shenzhen
China Bicycle Company (Holdings) Limited, the general manager of Jilin Fude Investment Holding Co., Ltd., a director of Jiaxing
Zhishifang Food Technology Co., Ltd., a supervisor of Le Shan City Commercial Bank Co., Ltd., and a Director of the Company.
Mr. Yuan Kang, born in 1979, graduated from Seneca College in Toronto, Canada, served as a supervisor of Fujian Fenghe Group
Co., Ltd., and now serves as a director of the Company.
Mr. Wang Guoxiang, born in 1954, is a Chinese national without the right of permanent residence abroad. He is currently a
supervisor of Wansheng Industrial Holdings (Shenzhen) Co., Ltd., a supervisor of Shenzhen Wansheng Kejiao Holdings Co., Ltd., a
supervisor of Shenzhen Huaxia Juanyong Cultural Tech. Co., Ltd., and a director of the Company.
41
Mr. Guo Qiuquan, born in 1983, is a member of the Communist Party of China and a Chinese national, a PhD of Biomedical
Engineering, the University of Western Ontario, Canada, a bachelor of Engineering Mechanics and a master of Physical Electronics
from Beijing Institute of Technology, and he belongs to Class-C in the peacock plan of recruiting high-level overseas talents of
Shenzhen. In 2016, he was sponsored by the Ministry of Human Resources and Social Security for overseas students. So far, he has
published more than 70 papers in international advanced journals, and has 12 authorized invention patents and 12 authorized utility
model patents. Some of his patented technologies won the technology transformation award of WorlDiscovery of the University of
Western Ontario. Mr. Guo Qiuquan is currently an associate researcher of the Institute for Advanced Study of University of
Electronic Science and Technology of China (Shenzhen), general manager of Jiangsu Xinchengrui Material Technology Co., Ltd.,
the president and general manager of Shenzhen Topmembranes Technology Co., Ltd., and an independent director of the Company.
Mr. Zhan Qiyong, born in 1982, is a member of the Communist Party of China and a Chinese national. He has a master's degree in
accounting from Jiangxi University of Finance and Economics. He is a certified public accountant and a certified tax agent. Mr. Zhan
Qiyong once served successively as an accountant of Finance Department of Shenzhen Wang Xin Linkage Technology Co., Ltd., an
accountant and an assistant manager of Finance Department of Shenzhen Gold Coin Co., Ltd.. Now he is the deputy manager of
Finance Department of Shenzhen Gold Coin Co., Ltd., and an independent director of the Company.
Mr. Yuan Qinghui, born in 1979, is a Chinese national, has a bachelor 's degree in law, and is a lawyer. He passed the China Judicial
Examination in 2002 and began practicing law in 2003. Now he is the director of Fujian Luyuan Laws Firm and an independent
director of the Company.
Mr. Guo Yong, born in 1975, graduated as a major in economy and trade from Henan Agricultural University in 1995. He is a master
of Arts and Crafts in Henan Province and a representative inheritor of national intangible cultural heritage (jun porcelain firing
technique). Mr. Guo Yong successively served as the general manager of the First Branch of Henan Provincial Wood Corporation,
the general manager of Yuzhou Longyu Tungsten & Molybdenum Material Co., Ltd., and the chairman of Huangshi Wanjun
International Art (Shenzhen) Co., Ltd. Currently, he is the chairman and general manager of Henan Wanjuntang Porcelain Culture
Development Co., Ltd., an executive director and general manager of Yuzhou Wanjuntang Culture Development Co., Ltd., an
executive director and general manager of Zhengzhou Baoshang Jewelry Co., Ltd., director of Intangible Cultural Heritage
Committee of Chinese Traditional Culture Promotion Association, and convener of the Board of Supervisors of the Company.
Mr. Li Niansheng, born in 1984, Chinese nationality, has a bachelor degree in biological engineering from Tianjin University of
Science and Technology. He successively served as the investment director and general manager of Shenzhen Runjing Asset
Management Co., Ltd.. Currently, he is the general manager of Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd., and a
supervisor of the Company.
Mr. Yi Wenzhi, born in 1970, has a college degree. He joined the Company in 1992 and successively served as a member of the life
management committee of Longhua Plant #2, an equipment manager of painting workshop, a production dispatcher of painting
workshop, the chairman of the labor union of painting workshop, and a member of Youth League Committee of Longhua Plant #2.
He is currently the deputy director of the company's general affairs office, the chairman of the company's labor union, a member of
the company's party committee and the secretary of the second branch, a member of the trade union committee of Shenzhen Yuanling
Street, and an employee representative supervisor of the Company.
Post-holding in shareholder’s unit
42
Applicable □Not applicable
Received
Position in
Name of Start dated of End date of office remuneration from
Name shareholder’s unit
shareholder’s unit office term term shareholder’s unit
n
(Y/N)
Wansheng
Industrial
Executive Director
Wang Shenghong Holdings 2017-06-13 - N
and GM
(Shenzhen) Co.,
Ltd.
Wansheng
Industrial
Wang Guoxiang Holdings Supervisor 2018-08-13 - N
(Shenzhen) Co.,
Ltd.
Explanation N/A
Post-holding in other unit
Applicable □Not applicable
Received
Name of other Position in other Start dated of End date of office
Name remuneration from
units unit office term term
other unit (Y/N)
Shenzhen Huaxia
Executive Director
Wang Shenghong Junyong Cultural 2020-5-9 - N
and GM
Tech. Co., Ltd.
Shenzhen
Executive Director
Wang Shenghong Wansheng Kejiao 2019-6-6 - N
and GM
Holding Co., Ltd.
Shenzhen
Chanjuan Holding Executive Director
Wang Shenghong 2020-1-7 - N
Development Co., and GM
Ltd.
Shenzhen
Executive Director
Wang Shenghong Chanjuan 2017-12-21 - N
and GM
Industrial Co., Ltd.
Shenzhen
Wang Shenghong Chanjuan Jewelry Director 2022-8-22 - N
Co., Ltd.
Shenzhen Huhui
Alliance E-
Li Hai Director 2015-4-10 - Y
Commerce Co.,
Ltd.
Huizhou Daya Bay
Merchant in
Sun Longlong Longzhen Trading 2021-11-10 Y
charge
Firm
Jilin Fude
Yao Zhengwang Investment GM 2014-11-21 Y
Holding Co., Ltd.
Jiaxing Zhishifang
Yao Zhengwang Food Tech. Co., Director 2012-12-24 Y
Ltd.
Le Shan City
Yao Zhengwang Supervisor 2019-06-21 Y
Commercial Bank
Zhengda Energy
Yao Zhengwang Development Supervisor 2017-02-09 Y
(China) Co., Ltd.
43
Shenzhen
Guosheng Energy
Yao Zhengwang Investment Supervisor 2006-10-12 Y
Development Co.,
Ltd.
Shenzhen
Longpeng
Yao Zhengwang Supervisor 2009-07-21 Y
Investment Co.,
Ltd.
Shenzhen
Yao Zhengwang Zhengrui Energy Supervisor 2016-02-25 Y
Tech. Co., Ltd.
Shenzhen
Longgang
Merchant in
Yao Zhengwang Henggang 2000-02-17 Y
charge
Zhengwang Store
Co., Ltd.
Fujian Chanjuan Executive Director
Yuan Kang 2020-12-22 N
Jewelry Co., Ltd. and GM
Shenzhen Huaxia
Executive Director
Wang Guoxiang Junyong Cultural 2020-5-9 - N
and GM
Tech. Co., Ltd.
Shenzhen
Executive Director
Wang Guoxiang Wansheng Kejiao 2019-6-6 - N
and GM
Holding Co., Ltd.
Shenzhen
Guo Qiuquan Topmembranes Chairman 2015-08-25 Y
Tech. Co., Ltd.
Jiangsu
Xinchengrui
Guo Qiuquan GM 2019-10-24 Y
Material Tech. Co.,
Ltd.
Nanjing Jusixing
Guo Qiuquan IntelligentTech. GM 2022-8-9 Y
Co., Ltd.
Shensi Laifu
Guo Qiuquan (Shenzhen) Tech. Supervisor 2022-10-19 Y
Co., Ltd.
Shenzhen Gold Deputy financial
Zhan Qiyong May 2015 Y
Coin Co., Ltd. manager
Fujian Luyuan
Yuan Qinghui Chief lawyer September 2008 Y
Laws Firm
Henan Wanjuntang
Porcelain Culture Executive Director
Guo Yong 2016-01-12 Y
Development Co., and GM
Ltd.
Yuzhou
Wanjuntang
Executive Director
Guo Yong Culture 2019-11-14 Y
and GM
Development Co.,
Ltd.
Zhengzhou
Executive Director
Guo Yong Baoshang Jewelry 2015-07-23 Y
and GM
Co., Ltd.
Henan Jianhe
Guo Yong Traditional Supervisor 2019-7-31 Y
Chinese Medicine
44
Hospital Co., Ltd.
Henan Jianhe
Guo Yong Pharmacy Co., Supervisor 2020-10-26 Y
Ltd.
Shenzhen Runjing
Assets
Li Niansheng GM 2016-09-19 Y
Management Co.,
Ltd.
Shenzhen
Bochuangke
Yi Wenzhi Information Supervisor 2011-05-11 Y
Consulting Co.,
Ltd.
Explanation N/A
Punishment of securities regulatory authority in recent three years to the company’s current and outgoing directors, supervisors
and senior management during the reporting period
□Applicable Not applicable
3. Remuneration for directors, supervisors and senior executives
Decision-making procedures, recognition basis and payment for directors, supervisors and senior executives
Decision procedure of
remuneration of directors, According to relevant rules of the Article of Association, the general meeting of shareholders decides
supervisors, senior remuneration of directors and supervisors. The Board of Directors decides senior management’s.
management
Confirmation basis of The Company refers to the position rank and comprehensive industry level. And then general meeting of
remuneration of directors, shareholders approves compensation standard and allowance of independent directors. According to the
supervisors and senior "Interim Measures to Annual Performance Assessment of Executives" and performance evaluation
management standards the Company issues annual performance salary.
Actual payment of The Company strictly paid remuneration of directors, supervisors and senior management accordingly
remuneration of directors, with decision procedure and confirmation basis. Total payment for remuneration of directors,
supervisors and senior supervisors and supervisors amounted to 1.3951 million yuan from January to December in 2022.
management
Remuneration for directors, supervisors and senior executives in reporting period
Unit: 10,000 Yuan
Total Whether
remuneration remuneration
Post-holding
Name Title Sex Age obtained from obtained from
status
the Company related party of
(before taxes) the Company
Currently in
Li Hai Director Male 54 62.07 N
office
Currently in
Sun Longlong Director Male 50 23.9 N
office
Currently in
Li Niansheng Supervisor Male 39 1.8 N
office
Currently in
Yi Wenzhi Supervisor Male 53 1.01 N
office
Zhong Hua Director Male 59 Outgoing 16.58 N
45
Zheng
Supervisor Male 61 Outgoing 10.06 N
Zhonghuan
Staff
Li Jialin Male 62 Outgoing 9.81 N
Supervisor
Independent
Yang Lang Female 54 Outgoing 4.76 N
director
Independent
Song Xishun Male 60 Outgoing 4.76 N
director
Independent
Zhang Zhigao Male 58 Outgoing 4.76 N
director
Total -- -- -- -- 139.51 --
VI. Responsibility performance of directors during the reporting period
1. The board of directors during the reporting period
Session of meeting Date of meeting Disclosure date Meeting resolutions
Refer to the Juchao Website
(www.cninfo.com.cn):
The 37th Session of 10th BOD 2022-04-22 2022-04-26
Resolution of the 37th Session
of 10th BOD (No.: 2022003)
Deliberated only one proposal
The 38th Session (interim) of as the Q1 Report of 2022,
2022-04-28 2022-04-29
10th BOD which was disclosed on April
29, 2022
Refer to the Juchao Website
The 39th Session (interim) of (www.cninfo.com.cn):
2022-06-06 2022-06-07
10th BOD Resolution of 39th Session of
10th BOD (No.: 2022011)
Deliberated only one proposal
as the Semi-Annual Report of
The 40th Session of 10th BOD 2022-08-24 2022-08-26
2022, which was disclosed on
August 26, 2022
Refer to the Juchao Website
(www.cninfo.com.cn):
The 41st Session (interim) of
2022-09-29 2022-09-30 Resolution of 41st Session
10th BOD
(interim) of 10th BOD (No.:
2022022)
Refer to the Juchao Website
(www.cninfo.com.cn):
The 42nd Session (interim) of
2022-10-25 2022-10-26 Resolution of 42nd Session
10th BOD
(interim) of 10th BOD (No.:
2022027)
Deliberated only one proposal
The 43rd Session (interim) of as the Q3 Report of 2022,
2022-10-27 2022-10-28
10th BOD which was disclosed on
October 28, 2022
Refer to the Juchao Website
(www.cninfo.com.cn):
The 44th Session (interim) of
2022-11-10 2022-11-11 Resolution of 44th Session
10th BOD
(interim) of 10th BOD (No.:
2022035)
Refer to the Juchao Website
(www.cninfo.com.cn):
The 1st Session of 11th BOD 2022-11-28 2022-11-29
Resolution of 1st Session of
11th BOD (No.: 2022042)
46
2. The attending of directors to Board meetings and shareholders general meeting
The attending of directors to Board Meeting and Shareholders General Meeting
Times of Times of
Absent the
Board attending the Times of
Times of Meeting for
meeting Times of Board Times of attend the
Director entrusted the second
supposed to Presence Meeting by Absence general
presence time in a row
attend in the communicati meeting
(Y/N)
report period on
Wang
1 1 0 0 0 N 0
Shenghong
Li Hai 9 9 0 0 0 N 3
Sun
9 9 0 0 0 N 3
Longlong
Yao
9 4 5 0 0 N 3
Zhengwang
Yuan Kang 1 0 1 0 0 N 0
Wang
1 0 1 0 0 N 0
Guoxiang
Guo Qiuquan 1 0 1 0 0 N 0
Zhan Qiyong 1 0 1 0 0 N 0
Yuan
1 0 1 0 0 N 0
Qinghui
Yang Fenbo 8 5 3 0 0 N 1
Cao Fang 8 1 7 0 0 N 1
Zhong Hua 8 8 0 0 0 N 3
Yang Lang 8 0 8 0 0 N 1
Song Xishun 8 0 8 0 0 N 1
Zhang
8 0 8 0 0 N 1
Zhigao
Explanation of absent the Board Meeting for the second time in a row
Nil
3. Objection for relevant events from directors
Directors come up with objection about Company’s relevant matters
□Yes No
No directors come up with objection about Company’s relevant matters in the Period
4. Other explanation about responsibility performance of directors
The opinions from directors have been adopted
Yes □No
Director's statement to the Company that a proposal has been or has not been adopted
During the reporting period, the directors carefully deliberated all proposals submitted to the BOD and voted in favor of the
proposals that required voting, without any opposition or abstention, and raised no objection to the proposals of the Board for the
year.
47
VII. Performance of Duties by Specialized Committees under the Board Meeting in the
Reporting Period
Important Specific
Number of comments Other circumstance
Committee Meeting
Members meetings Date of and performance s of the
name content
held meeting suggestions of duties objection (if
made applicable)
Deliberation
of the Annual Draws
Report 2021 management’
Yang Lang, 2022-04-19 and related s attention on N/A N/A
internal relevant
Audit Zhang control proposals
2
committee Zhigao and reports
Cao Fang Renewal of
the
2022-06-02 accounting N/A N/A N/A
firms
Guo Nominated
Qiuquan, and approval
Nomination Wang the candidate
1 2022-11-28 N/A N/A N/A
Committee Shenghong of senior
and Yuan executives of
Qinghui the Company
VIII. Works from Supervisory Committee
The Company has risks in reporting period that found in supervisory activity from supervisory committee
□Yes No
Supervisory committee has no objection about supervision events in reporting period
IX. Particulars of workforce
1. Number of Employees, Professional composition, Education background
Employee in-post of the parent Company at period-end
36
(people)
Employee in-post of main Subsidiaries at period-end (people) 27
The total number of current employees at period-end (people) 63
The total number of current employees to receive pay (people) 63
Retired employee’ s expenses borne by the parent Company
0
and main Subsidiaries (people)
Professional composition
Category of professional composition Numbers of professional composition (people)
Production personnel 8
Salesperson 16
Technicians 18
Financial personnel 7
Administrative personnel 14
48
Total 63
Education background
Type of Education Numbers (people)
Postgraduate 1
Undergraduate 23
Junior college 21
Below junior college 18
Total 63
2. Remuneration Policy
Formulated the remuneration policy according to the position title and comprehensive industry salary standards
3. Training programs
In order to improve the quality of staff, the company has planned and targeted training activities every year. The training activities
for administrative personnel and technical staff mainly to improve their professional skills, management quality and ability
4. Labor outsourcing
□Applicable Not applicable
X. Profit distribution plan and capitalizing of common reserves plan
Formulation, Implementation and Adjustment of common stock Profit Distribution Policy Especially Cash Dividend policy during
the Reporting Period
□Applicable Not applicable
The company is profitable during the reporting period and the parent company has positive profit available for distribution to
shareholders but no cash dividend distribution plan has been proposed
□Applicable Not applicable
Profit distribution plan and capitalizing of reserves for the Period
□Applicable Not applicable
The Company has no plans of cash dividend distributed, no bonus shares and has no share converted from capital reserve either for
the year.
XI. Implementation of the Company’s stock incentive plan, employee stock ownership plan
or other employee incentives
□Applicable Not applicable
During the reporting period, the Company has no stock incentive plan, employee stock ownership plan or other employee
incentives that have not been implemented.
49
XII. Construction and implementation of internal control system during the reporting
period
1. Construction and implementation of internal control
In accordance with the provision of Basic Standards for Enterprise Internal Control and its supporting guidelines, the Company
renewal and improve the internal control system of the Company during the reporting period. Established a set of internal control
system with scientific design, simple application and effective operation. Regularly, the Company carried out special work of system
combing and optimization every year, and the work is effectively integrated with the internal control assessment of the Company.
Through the system evaluation, achieved the improvement of the system, standardization of the effectiveness of the establishment
and optimization of the process, and full implementation.
2. Details of major defects in internal control identified during the reporting period
□Yes No
XIII. Management and controls on the subsidiary during reporting period
Problems
Integration Integration Measures taken Progress in Follow-up
Name encountered in
plans progress to resolve solution solution plan
integration
Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable
XIV. Internal control self-appraisal report or internal control audit report
1. Self-appraisal Report of Internal Control
Disclosure date of full internal control
25 April 2023
evaluation report
Disclosure index of full internal control
Self-Appraisal Report of Internal Control 2022 of CBC released on Juchao website
evaluation report
The ratio of the total assets of units
included in the scope of evaluation
accounting for the total assets on the 100.00%
company's consolidated financial
statements
The ratio of the operating income of
units included in the scope of evaluation
accounting for the operating income on 100.00%
the company's consolidated financial
statements
Defects Evaluation Standards
Category Financial Reports Non-financial Reports
Material defect: (1) inefficiency of Material defect: (1) inefficiency of
environment control; (2) inefficiency of environment control; (2) inefficiency of
internal supervision; (3) direct impact on internal supervision; (3) direct impact on
major mistakes of investment decisions; major mistakes of investment decisions;
(4) directly make the significant error in (4) directly make the significant error in
Qualitative criteria
the financial statements; (5) violation of the financial statements; (5) violation of
the laws, regulations, rules and other the laws, regulations, rules and other
normative documents, resulting in normative documents, resulting in
investigation of the central government investigation of the central government
and regulatory agencies, and being and regulatory agencies, and being
50
sentenced to a fine or penalty, being sentenced to a fine or penalty, being
restricted industry exit, canceling restricted industry exit, canceling
business license and being forced the business license and being forced the
closure of etc. Major defect: (1) indirect closure of etc. Major defect: (1) indirect
impact on major mistakes of investment impact on major mistakes of investment
decisions; (2) indirectly make the decisions; (2) indirectly make the
significant error in the financial significant error in the financial
statements; (3) Lack of important statements; (3) Lack of important
system; (4) violation of the laws, system; (4) violation of the laws,
regulations, rules and other normative regulations, rules and other normative
documents, resulting in investigation of documents, resulting in investigation of
the local government and regulatory the local government and regulatory
agencies, and being sentenced to a fine agencies, and being sentenced to a fine
or penalty, and being ordered to suspend or penalty, and being ordered to suspend
business for rectification and cause the business for rectification and cause the
Company’s business stop of etc. General Company’s business stop of etc. General
defect: other control defect besides defect: other control defect besides
material defect and major defect. material defect and major defect.
1. Potential loss or potential error of total 1. Potential loss or potential error of total
profit: (1) General defect: less than or profit: (1) General defect: less than or
equal to pre-tax total profit of 3%, (2) equal to pre-tax total profit of 3%, (2)
Major defect: more than pre-tax total Major defect: more than pre-tax total
profit of 3%( and absolute amount more profit of 3%( and absolute amount more
than RMB 0.5 million), (3) Material than RMB 0.5 million), (3) Material
defect:: more than 5% of pre-tax total defect:: more than 5% of pre-tax total
profit and absolute amount more than profit and absolute amount more than
RMB 1 million; 2. Potential loss or RMB 1 million; 2. Potential loss or
potential error of operating income: (1) potential error of operating income: (1)
General defect: less than or equal to General defect: less than or equal to
Quantitative standard operating income of 1%, (2) Major operating income of 1%, (2) Major
defect: more than 1% of operating defect: more than 1% of operating
income and less than or equal to 3% of income and less than or equal to 3% of
operation income, (3) Material defect:: operation income, (3) Material defect::
more than 3% of operating income; 3. more than 3% of operating income; 3.
Potential loss or potential error of total Potential loss or potential error of total
assets: (1) General defect: less than or assets: (1) General defect: less than or
equal to 1% of total assets, (2) Major equal to 1% of total assets, (2) Major
defect: more than 1% of total profit and defect: more than 1% of total profit and
less than or equal to 3% of total profit, less than or equal to 3% of total profit,
(3) Material defect:: more than 3% of (3) Material defect:: more than 3% of
total profit total profit
Amount of significant defects in
0
financial reports
Amount of significant defects in non-
0
financial reports
Amount of important defects in financial
0
reports
Amount of important defects in non-
0
financial reports
2. Auditing report of internal control
Applicable □Not applicable
Deliberations in Audit Report of Internal Control
We considers that China Bicycle Company (Holdings) Limited, in line with Basic Norms of Internal Control and relevant
regulations, shows an effectiveness internal control of financial report in all major aspects dated 31 December 2022.
Disclosure details of audit report of internal control Disclosed
Disclosure date of audit report of internal control (full-text) 25 April 2023
Juchao Website- Audit Report of Internal Control of Shenzhen
Index of audit report of internal control (full-text) China Bicycle Company (Holdings) Limited (TZY Zi[2023]
No.11694-2
Opinion type of auditing report of IC Standard unqualified
Whether the non-financial report had major defects No
51
Carried out modified opinion for internal control audit report from CPA
□Yes No
The internal control audit report, issued by CPA, has concerted opinion with self-evaluation report, issued from the Board
Yes □No
XV. Rectification of Self-examination Problems in Special Governance Actions in Listed
Company
Not applicable
52
Section V. Environmental and Social Responsibility
I. Major environmental
The listed Company and its subsidiary whether belongs to the key sewage units released from environmental protection
department
□Yes No
Administrative punishment for environmental problems during the reporting period
Impact on the
The company’s
Company name or Reason for production and
Violation Punishment result rectification
subsidiary name punishment operation of listed
measures
company
Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable
Other environmental information disclosed refer to key polluters
Not applicable
Measures taken to reducing the carbon emissions during the reporting period and their effectiveness
□Applicable Not applicable
Reasons for not disclosing other environmental information
Not applicable
II. Social responsibility
During the reporting period, the company conscientiously fulfilled its corporate social responsibility, paid attention to protecting the
interests of shareholders, especially minority shareholders; Treated suppliers, customers and consumers with integrity; Earnestly
fulfilled the responsibilities and obligations to the society, shareholders, employees and other stakeholders, created a harmonious
environment for enterprise development, and realized the common development of the enterprise and stakeholders.
1. Protection of shareholders' rights and interests
The company strictly complies with the provisions of relevant laws and regulations such as the Company Law, the Securities Law
and the Governance Code for Listed Companies, continuously improves the corporate governance structure, adheres to handing over
the important matters to the resolutions of the shareholders' meeting, provides convenience for medium and small investors to
participate in the shareholders' meeting, fully listens to the small and medium-sized investors’ reasonable advice on the company's
development and governance, and safeguards the legitimate rights and interests of shareholders.
In 2022, the board of directors of the company convened 3 shareholders' meetings, the meeting adopted the combination of on-site
voting and online voting, the votes of small and medium investors were counted separately, provided convenience for the majority of
investors to participate in the voting at the shareholders' meeting, and ensured the participation right and supervision right of the
small and medium-sized investors.
53
In 2022, the company strengthened communication with investors, especially investors from the public, answered questions about
which the public and investors concerned, and ensured the investors' right to know in line with the Information Disclosure Affairs
Management System and Reception and Promotion Work System and by means of various forms such as the interactive platform of
Shenzhen Stock Exchange, hotline of the company’s securities affairs department, and so on.
On May 19, 2022, the company held the 2021 annual performance briefing, in which the company made online communication with
investors on the company's performance, operating conditions, development prospects and other issues of interest to investors. A
total of 11 questions were raised by investors during the briefing, which were answered by directors and senior management
personnel.
On November 9, 2022, the company participated in the collective reception day for investors of listed companies in Shenzhen in
2022, and conducted online communication with investors on corporate reorganization, change of office term of the board and other
issues concerned by investors. During the reception day, the directors and senior management at the meeting responded to all
questions raised by investors.
The company is committed to protecting the rights and interests of investors by improving the corporate governance structure,
improving the level of information disclosure and investor relationship management, and carrying out investor education, and
guiding investors to form value investment concept through real and effective communication. In order to effectively ensure smooth
service channels for investors, the company has arranged full-time personnel to answer investors' hotline calls and answer questions
on the interactive platform, and relevant staff has patiently analyzed the announcement information for investors to help investors
understand the company's situation in time.
2. Protection of workers' rights and interests
The company adheres to the people-oriented, comprehensively implements the Labor Law and Labor Contract Law, attaches great
importance to guarantee of the employees' rights and interests, at the same time, establishes good communication channels
throughout the whole process of staff management and care, pays attention to staff growth, improves the staff overall quality,
cultivates excellent internal training culture system, creates a good learning environment. Meanwhile, the company pays attention to
enriching the spiritual life of employees, regularly carries out staff activities, and improves team cohesion. In accordance with the
Labor Contract Law of the People's Republic of China and other relevant national and local labor laws and regulations, the company
signs labor contracts with employees to protect their rights and interests. The company and its subsidiaries strictly implement the
national employment system, labor protection system, social security system and medical security system, and pay the housing
provident fund, medical insurance, endowment insurance, unemployment insurance, work-related injury insurance and maternity
insurance for employees according to the state regulations. The company adheres to corporate culture of efficient coordination,
people-oriented, on-demand training, training by level, and echelon training. The company establishes internal knowledge sharing
system, promotes information and knowledge exchange among various modules of the company, and improves team coordination
ability. It encourages employees to participate in continuing education and enhances the knowledge structure optimization and
professional quality promotion of workers at various positions.
3. Protection of rights and interests of suppliers, customers and consumers
The company actively organizes and carries out customer management, takes measures to ensure the rights and interests of customers
and actively promotes customer satisfaction and service excellence. It makes full use of the rich social resources in the market, and
establishes a good partnership with suppliers. The company promises not to abuse or misuse consumer information for the protection
of rights and interests of consumers.
54
III. Consolidating and expanding the achievements of poverty alleviation and rural
revitalization
Not applicable
55
Section VI. Important Events
I. Implementation of commitment
1. Commitments completed in Period and those without completed till end of the Period from actual controller, shareholders, related parties, purchaser
and companies
Applicable □Not applicable
Commitment Implemen
Commitment Type Content Date Term
party tation
After the completion of the non-public offering, within the scope of shareholder rights that can be
exercised by Wansheng Industrial \ I myself, the independence of the listed company in terms of
personnel, assets, finance, organization and business will be guaranteed as follows:
I Personnel independence
1. Ensure that the general manager, deputy general manager, chief financial officer, secretary of the
board and other senior executives of the listed company work full-time in the listed company and do
Wansheng not hold other positions except director and supervisor in other enterprises controlled by Wansheng
Commitments Commitment
Industrial
made in to maintain Industrial \ I myself and do not receive salary in other enterprises controlled by Wansheng Industrial
Holdings Normal
acquisition the \ I myself. 7 November Valid for
(Shenzhen) performan
report or report independence 2022 long term
Co., Ltd. and 2. Ensure that the financial personnel of the listed company are independent and do not take part- ce
on changes in of listed
Wang time jobs or receive remuneration in other enterprises controlled by Wansheng Industrial \I myself.
equity company
Shenghong
3. Ensure that the listed company has a complete and independent labor, personnel and salary
management system, which is completely independent from other enterprises controlled by
Wansheng Industrial \I myself.
II Assets independence
1. Ensure that the listed company has independent and complete assets, all assets of the listed
company are under the control of the listed company, and are independently owned and operated by
56
the listed company. Ensure that other enterprises controlled by Wansheng Industrial \I myself shall
not occupy the funds and assets of the listed company in any illegal way.
2. Ensure that the assets of the listed company will not be used to illegally guarantee the debts of
other enterprises controlled by Wansheng Industrial \I myself .
III Financial independence
1. Ensure that the listed company establishes independent financial departments and independent
financial accounting systems.
2. Ensure that the listed company has a normative and independent financial accounting system and
a financial management system for its subsidiaries.
3. Ensure that the listed company opens bank accounts independently and does not share bank
accounts with Wansheng Industrial \ I myself and other enterprises under my control.
4. Ensure that the listed company can make independent financial decisions, and Wansheng
Industrial \ I myself and other enterprises under my control do not interfere in the use and
procurement of funds of the listed company through illegal means.
5. Ensure that the listed company pays taxes independently according to law.
IV Business independence
1. Ensure that the listed company has the assets, personnel, qualifications and ability to carry out
business activities independently, and has the ability to operate independently and sustainably in the
market.
2. Guarantee to minimize related transactions between Wansheng Industrial \ I myself and other
enterprises controlled by myself and the listed company. Related transactions that cannot be avoided
or have reasonable reasons shall be conducted in accordance with the the law and the principle of
openness, fairness and justice.
V Institutional independence
1. Ensure that the listed company establishes and improves the corporate governance structure of the
joint-stock company in accordance with the law and has an independent and complete organizational
structure.
2. Ensure that the shareholders' meeting, board of directors, independent directors, board of
supervisors and senior executives of the listed company independently exercise their functions and
powers in accordance with laws, regulations and the company's articles of association.
57
3. Ensure that the listed company has an independent and complete organizational structure, and
there is no confusion between the listed company and other enterprises controlled by Wansheng
Industrial \ I myself .
VI Ensure that the listed Company is otherwise independent from Wansheng Industrial \ I myself
and other enterprises under my control
In case of any breach of the above commitments, thus causing economic losses to the listed
company, Wansheng Industrial \ I myself will indemnify the listed company.
1. Wansheng Industrial \ I myself do not, and will not, directly or indirectly engage in any business
or activity at home and abroad which is the same, or similar to the existing business of the listed
company and which constitutes or may constitute direct or indirect competition to the existing
business of the listed company in any aspect in any way (including but not limited to sole
proprietorship, joint venture, cooperation and joint venture), nor provides any assistance in fund,
business and management or provides any technical information, business operation, sales channels
and other trade secrets to enterprises, institutions or other economic organizations competing with
the listed company's existing business in any way;
2. Wansheng Industrial \ I myself do not establish or acquire any business entity that is engaged in
Wansheng the same or similar business as the listed company's existing business, or any company, enterprise or
Commitments
Industrial Commitment
made in other institution or organization that competes with the listed company's existing business in any
Holdings to avoid Normal
acquisition aspect; 7 November Valid for
(Shenzhen) competition in performan
report or report 2022 long term
Co., Ltd and the same 3. From the date of issuance of this letter of commitment, if any business opportunity obtained by ce
on changes in
Wang industry Wansheng Industrial \ I myself from any third party constitutes or may constitute material
equity
Shenghong
competition with the existing business of the listed company, Wansheng Industrial \ I myself will
immediately notify the listed company and try its best to transfer such business opportunity to the
listed company;
4. This letter of commitment takes effect from the date of issuance and remains valid and irrevocable
during the period when Wansheng Industrial \ I myself am a shareholder holding more than 5%
equity of the list company.
5. In case of direct or indirect economic losses caused to the listed company due to its failure to
fulfill the above commitments, Wansheng Industrial \ I myself shall compensate the listed company
for all the losses suffered thereby.
58
1. As of the date of issuance of this letter of commitment, there was no related transaction between
Wansheng Industrial/I myself and other companies controlled by Wansheng Industrial/I myself and
the listed company or any related transaction that should be disclosed in accordance with laws and
regulations but not disclosed .
1. Upon completion of the transaction, Wansheng Industrial/I myself and other companies controlled
by Wansheng Industrial/I myself will avoid and reduce related transactions with the listed company
as far as possible in accordance with laws, regulations and other normative documents. For related
transactions that cannot be avoided or occur for reasonable reasons, Wansheng Industrial/I myself
and other companies controlled by Wansheng Industrial/I myself will follow the market principles of
Wansheng justice, fairness and openness, sign agreements with the listed company according to law, perform
Commitments
Industrial
made in Commitment legal procedures, comply with relevant laws, regulations, other normative documents and the articles
Holdings Normal
acquisition on regulating 7 November Valid for
(Shenzhen) of association of the listed company, and perform relevant internal decision-making procedures in performan
report or report the related 2022 long term
Co., Ltd and accordance with the law and timely fulfill the obligations of information disclosure, ensure that the ce
on changes in transactions
Wang
equity pricing of related transactions is fair and reasonable and the trade terms are fair, guarantee not to use
Shenghong
related transactions to illegally transfer the funds and profits of the listed company nor to use such
transactions to engage in any behavior that damages the legitimate rights and interests of the listed
company and other shareholders.
3. This Commitment shall remain valid during the period when Wansheng Industrial/I myself serve
as the direct/indirect controlling shareholder/actual controller of the listed company. Wansheng
Industrial/I myself guarantee to strictly fulfill all commitments in this letter of commitment. If any
loss is caused to the listed company due to violation of such commitments, Wansheng Industrial/I
myself will bear the corresponding liability for compensation.
After the completion of this non-public offering, the shares subscribed by Wansheng Industrial is not
Wansheng allowed to be transferred within 36 months from the date of listing of this stock issue. The non-
Industrial
public offering of shares of the company acquired by the issuing object and the shares acquired as a
Commitments Holdings Commitment Normal
result of the company's allocation of stock dividends and the capital reserve converted into share 7 November
made at IPO or (Shenzhen) on shares 36 months performan
2022
refinancing Co., Ltd and restriction capital shall also comply with the above share lock-in arrangement. After the expiration of the ce
Wang restriction period, it will be subject to the relevant regulations of China Securities Regulatory
Shenghong
Commission and Shenzhen Stock Exchange.
59
For the next three years after the completion of the non-public offering of shares and the completion
of the adjustment of the board of directors and the board of supervisors of Shenzhen China Bicycle
by Wansheng Industrial, the net profit of the listed company shall be no less than 30 million yuan, 35
million yuan and 40 million yuan respectively, that is, the cumulative net profits shall be 105 million
Wansheng yuan.
Industrial If the actual cumulative net profits of the listed company fails to reach the cumulative net profits of
1 Jan.
Commitments Holdings Performance the listed company in any year within the performance commitment period, Wansheng Industrial Normal
7 November 2023-31
made at IPO or (Shenzhen) compensation performan
shall compensate the listed company in cash within ten working days after the issuance of audit 2022 December
refinancing Co., Ltd and commitment ce
report of the listed company in the current year within the performance commitment period. 2025
Wang
Shenghong The amount of compensation for the current year shall be calculated as follows:
Amount payable in the current year = Cumulative net profit committed by the end of the current
period - Cumulative net profit realized by the end of the current period - Cumulative amount
compensated (if any)
1. Do not interfere with the company's operation and management activities beyond its authority, and
do not occupy the company's interests;
2. Effectively perform the relevant measures formulated by the company to fill out the returns and
fulfill any commitments made to fill out the returns.
3. From the issuance date of this Commitment to the completion of the non-public offering of shares
Commitment
Wansheng on dilution of of the company, if the China Securities Regulatory Commission makes other new regulations on
Industrial the immediate filling out the return measures and commitments, and the above-mentioned commitments cannot
Commitments Holdings return on non- meet such regulations of the China Securities Regulatory Commission, I myself promise to issue Normal
7 November Valid for
made at IPO or (Shenzhen) public performan
supplementary commitments in accordance with the latest regulations of the China Securities 2022 long term
refinancing Co., Ltd and offering of A ce
Wang share and Regulatory Commission at that time;
Shenghong measures to 4. As one of the subjects responsible for filling out the return measures, if I myself violate the above
be taken
commitments or refuse to perform the above commitments, I myself agree that China Securities
Regulatory Commission, Shenzhen Stock Exchange and other securities regulatory authorities
punish me or take relevant management measures according to the relevant regulations and rules
formulated or issued by them.
60
Wansheng
Commitment Within 12 months after the completion of this issuance, Wansheng Industrial did not plan to launch
Industrial
not to initiate
Commitments Holdings major asset reorganization, asset acquisition and other major matters affecting the stock price of the Normal
major assets 7 November
made at IPO or (Shenzhen) 12 months performan
reorganization listed company, and there was no plan to realize the reorganization and listing step by step through 2022
refinancing Co., Ltd and ce
or assets cash subscription and asset acquisition.
Wang
acquisition
Shenghong
Commitment
on business of
Wansheng The Company and its actual controller, Wang Shenghong, do not hold or control more than 5% of the
the Company
Industrial
and business issued shares of other domestic and overseas listed companies, nor hold more than 5% of the shares
Commitments Holdings
of the core 2 November
made at IPO or (Shenzhen) of banks, trust companies, securities companies, insurance companies and other financial - Performed
enterprises of 2022
refinancing Co., Ltd and institutions.
the controlling
Wang
shareholder
Shenghong
and actual
controller
As of the date of signing this Commitment, the Company (Wansheng Industrial Holdings (Shenzhen)
Wansheng
Commitment Co., Ltd.) has not been subject to administrative penalties from the relevant authorities such as
Commitments Industrial
on absence of 2 November
made at IPO or Holdings banking, customs, taxation, environmental protection, industry and commerce, social security, and - Performed
administrative 2022
refinancing (Shenzhen) production safety since the date of establishment.
penalty
Co., Ltd.
Wansheng
Commitment As of the date of signing this Commitment, the Company (Wansheng Industrial Holdings (Shenzhen)
Commitments Industrial
on litigation 2 November
made at IPO or Holdings Co., Ltd.) has not had any litigation, guarantee and other matters since the date of establishment. - Performed
and 2022
refinancing (Shenzhen)
guarantees
Co., Ltd.
Commitment Within 12 months after the completion of this issuance, there was no plan to launch major assets
Shenzhen
not to initiate reorganization, asset acquisition and other major matters affecting the Company's stock price, nor is
Commitments China Bicycle Normal
major assets 7 November
made at IPO or Company there any plan to realize the reorganization and listing step by step through cash subscription and 12 months performan
reorganization 2022
refinancing (Holdings) asset acquisition. ce
or assets
Limited
acquisition
Commitment 1. Promise not to transfer benefits to other units or individuals free of charge or under unfair
Director and
Commitments on dilution of conditions, and not to damage the interests of the company by other means; Normal
senior 7 November Valid for
made at IPO or the immediate performan
executive of 2. Promise to restrict my position-related consumption behavior; 2022 long term
refinancing return on non- ce
the Company 3. Promise not to use the company's assets to engage in investment and consumption activities
public
61
offering of A unrelated to the performance of duties;
share and 4. Promise that the remuneration system formulated by the board of directors or the compensation
measures to
committee will be linked to the implementation of the company's measures to fill out the returns;
be taken
5. Promise that the venting conditions of the future equity incentive plan will be linked to the
implementation of the company's measures to fill out the returns if the company implements the
equity incentive plan in the future, ;
6. From the issuance date of this Commitment to the completion of the non-public offering of shares
of the company, if the China Securities Regulatory Commission makes other new regulations on
filling out the return measures and commitments, and the above-mentioned commitments cannot
meet such regulations of the China Securities Regulatory Commission, I myself promise to issue
supplementary commitments in accordance with the latest regulations of the China Securities
Regulatory Commission at that time;
7. As one of the subjects responsible for filling out the return measures, if I myself violate the above
commitments or refuse to perform the above commitments, I myself agree that China Securities
Regulatory Commission, Shenzhen Stock Exchange and other securities regulatory authorities
punish me or take relevant management measures according to the relevant regulations and rules
formulated or issued by them.
Whether
commitments
Yes
are fulfilled on
time
62
2. Concerning assets or project of the Company, which has profit forecast, and reporting period still in
forecasting period, explain reasons of reaching the original profit forecast
□Applicable Not applicable
II. Non-operational fund occupation from controlling shareholders and its related party
□Applicable Not applicable
No non-operational fund occupation from controlling shareholders and its related party in period.
III. External guarantee out of the regulations
□Applicable Not applicable
No external guarantee out of the regulations occurred in the period.
IV. Statement on the latest “modified audit report” by BOD
Applicable □Not applicable
On 11 May 2012, the largest shareholder and biggest creditor of the Company, Shenzhen Guosheng Energy Investment and
Development Co., Ltd. applied to Shenzhen Municipal Intermediate People's Court for reforming the Company as the Company
couldn’t pay off the matured debts and was seriously insolvent. On 12th, Oct., 2012, Shenzhen Municipal Intermediate People's Court
ruled to accept the application proposed by Guosheng Energy according to (2012) Shenzhen Intermediate Court Po Zi No. 30 civil
ruling. In late October, 2012, Shenzhen Municipal Intermediate People's Court ruled to reform the Company since 25th, Oct., 2012
according to (2012) Shenzhen Intermediate Court Po Zi No. 30-1 civil ruling, appointed King & Wood (Shenzhen) Mallesons and
Shenzhen ZhengYuan Liquidation Affairs Co., Ltd. as the custodians of the Company. At the same time, Shenzhen Municipal
Intermediate People's Court made (2012) Shenzhen Intermediate Court Po Zi No. 30-1 written decision, and approved the Company
to manage property and business affairs by itself under the supervision of custodians according to the law. On 5 November 2013, the
Shenzhen Intermediate People’s Court (2012) Shen Zhong Fa Po Zi No. 30-6 Civil Ruling Paper judged that approved the
reorganization plan of the Company. On 27 December 2013, the Civil Ruling Paper Shenzhen Intermediate People’s Court (2012)
Shen Zhong Fa Po Zi No. 30-10 ruled that the reorganization plan of CBC was completed and bankruptcy procedures of CBC closed
down.
The Company has solved the debt problem by reforming, realized the net assets with positive value, the main business of bicycle is
able to be maintained and realizes the stable development. The Company has set up the conditions for introducing the recombination
party in the reforming plan, and expects to restore the abilities of sustainable operation and sustained profitability by reorganization.
The conditions of introducing the recombination party includes: the assessed value of net assets should be no less than 2 billion Yuan,
the net assets in the same year for implementing the major reorganization should be no less than 200 million Yuan. The Company
doesn’t have the recombination party at the moment. The Company will continue to carry out vary related works actively and
promote the reorganization work with all efforts.
63
V. Explanation from Board of Directors, Supervisory Committee and Independent Directors
(if applicable) for “Qualified Opinion” that issued by CPA
□Applicable Not applicable
VI. Explanation of the changes in accounting polices, accounting estimates or correction of
significant accounting errors compared with the financial report of the previous year
Applicable □Not applicable
1. Change of accounting policy
(1)After approved by the BOD, relevant regulations with “Explanation of the Accounting Standards for Business Enterprise
No.15”(CK[2021]No.35) concerned are applicable since 1 January 2022, change of this accounting policy has no impact on the
financial statement in the Period.
(2)After approved by the BOD, relevant regulations with “Explanation of the Accounting Standards for Business Enterprise
No.16”(CK[2022]No.31) concerned are applicable since 1 January 2022, change of this accounting policy has no impact on the
financial statement in the Period.
2. Changes in accounting estimates
There were no major changes in accounting estimates during the company's reporting period.
3. Correction of previous accounting errors
During the reporting period of the company, no major prior accounting errors were corrected.
4. The adjustment of financial statement at the beginning of the year when first implemented the new
accounting standards or explanations since 2022
No effect
VII. Compare with last year’s financial report; explain changes in consolidation statement’s
scope
□Applicable Not applicable
There was no change in the scope of consolidated statements during the reporting period of the company.
VIII. Appointment and non-reappointment (dismissal) of CPA
Accounting firm appointed
Name of domestic accounting firm Baker Tilly China CPA (LLP)
Remuneration for domestic accounting firm (in 10 thousand
45
Yuan)
Continuous life of auditing service for domestic accounting
7
firm
Name of domestic CPA Qu Xianfu, Deng Jun
Continuous life of auditing service for domestic accounting
2
firm
64
Re-appointed accounting firms in this period
□Yes No
Appointment of internal control auditing accounting firm, financial consultant or sponsor
Applicable □Not applicable
1. During the reporting period, the company engaged Baker Tilly China CPA (LLP) as the auditing organ for internal control of the
Company, and it is expected to pay 150,000 yuan for internal control auditing.
2. During the reporting period, the company engaged Sinolink Securities as the sponsor for non-public offering of shares, sponsor fee
amounting to 3.3 million yuan in total.
IX. Particular about delisting after annual report disclosed
□Applicable Not applicable
X. Bankruptcy reorganization
□Applicable Not applicable
No bankruptcy reorganization for the Company in reporting period
XI. Significant lawsuits and arbitration of the Company
Applicable □Not applicable
Amount Resulted an
Lawsuits involved (in accrual Trial result Execution of Disclosure Disclosure
Progress
(arbitration) 10 thousand liability and influence judgment date index
Yuan) (Y/N)
Contract
dispute over
the urban
renewal Found more
project of in “Notice on
In the first
Zhonghua Lawsuits”
instance, The first trial
Garden Notice No.:
Yes, the defendant will not have The second
Phase II- 2022002 and
accrual returned 10 a material trial has not
Plaintiff(She “Progress of
liabilities of million yuan adverser been heard
nzhen Jianzhi 23 August Lawsuits”
3,085.9 890,000 yuan deposit and effect on till the date
Industrial 2022 Notice No.:
resulted from interest to the current profit when the
Development 2022019
relevant plaintiff; or future notice
Co., Ltd); released on
interests second trial profits of the released
Defendant Juchao
has not been Company
(Shenzhen Website
heard yet
China (www.cninfo.
Bicycle com.cn)
Company
(Holdings)
Limited)
Counter- The first The first trial The second Found more
23 August
claim in the 600 No judgment will not have trial has not in “Progress
2022
contract dismisses the a material been heard of Lawsuits”
65
dispute on plaintiff’s adverser till the date Notice No.:
urban claim; the effect on when the 2022019
renewal second trial current profit notice released on
project of has not been or future released Juchao
Zhonghua heard yet profits of the Website
Garden Company (www.cninfo.
Phase II- com.cn)
Plaintiff(She
nzhen China
Bicycle
Company
(Holdings)
Limited);
Defendant
(Shenzhen
Jianzhi
Industrial
Development
Co., Ltd)
XII. Penalty and rectification
□Applicable Not applicable
The Company had no penalty and rectification in the Period
XIII. Integrity of the company and its controlling shareholders and actual controllers
□Applicable Not applicable
XIV. Major related transaction
1. Related transaction with routine operation concerned
Applicable □Not applicable
Relate Whet
Tradi
d her Cleari
Propo ng
Type Conte transa over ng Availa
Relate rtion limit
of nt of Pricin ction the form ble Date Index
Relate Relati d in appro
relate relate g amou appro for simila of of
d onshi transa simila ved
d d princi nt (in ved relate r disclo disclo
party p ction r (in 10
transa transa ple 10 limite d marke sure sure
price transa thousa
ction ction thousa d or transa t price
ctions nd
nd not ction
Yuan)
Yuan) (Y/N)
The Relate Pricin Found
enterp d g more
Fuzho rises transa Sale based in the
u contro ction of on “Reco
Marke Settle
Zuank lled with goods marke Not gnitio
t 2,313. 2,313. ment 2023-
inson by the routin to t price 5.20% N applic n of
pricin 77 77 in 4-25
Jewelr contro e relate accor able the
g cash
y Co., lling operat d ding Daily
Ltd. subsid ion party to the Relate
iary conce princi d
of the rned ple of Trans
66
Comp fairne action
any ss and s for
with impart year
35% iality of
stock 2022
partici and
pated Expec
ted
Daily
Relate
d
Trans
action
s for
2023”
on
Jucha
o
Websi
te
(www
.cninf
o.com
.cn)
Found
more
in the
“Reco
gnitio
n of
The the
enterp Daily
rises Relate
contro Pricin d
lled g Trans
by the Relate based action
affilia d on s for
Fuzho tes of transa Sale marke year
u the ction of t price of
Marke Settle
Rongr contro with goods accor Not 2022
t 9,681. 21.77 9,681. ment 2023-
un lling routin to ding N applic and
pricin 07 % 07 in 4-25
Jewelr subsid e relate to the able Expec
g cash
y Co., iary operat d princi ted
Ltd. of the ion party ple of Daily
Comp conce fairne Relate
any rned ss and d
with impart Trans
35% iality action
stock s for
partici 2023”
pated on
Jucha
o
Websi
te
(www
.cninf
67
o.com
.cn)
11,99 11,99
Total -- -- -- -- -- -- -- --
4.84 4.84
Detail of sales return with major
Not applicable
amount involved
Report the actual implementation
of the daily related transactions
which were projected about their Not applicable
total amount by types during the
reporting period (if applicable)
Reasons for major differences
between trading price and market Not applicable
reference price (if applicable)
2. Related transactions by assets acquisition and sold
□Applicable Not applicable
No related transactions by assets acquisition and sold for the Company in reporting period.
3. Main related transactions of mutual investment outside
□Applicable Not applicable
No main related transactions of mutual investment outside for the Company in reporting period.
4. Contact of related credit and debt
Applicable □Not applicable
Whether exist non-operating contact of related credit and debt or not
Yes □No
Claim receivable from related party
Whether Current
Balance Current Current Balance
has non- amount
at period- recovery( interest(1 at period-
Related Relations Causes of business increased( Interest
begin(10 10 0 end(10
party hip formation capital 10 rate
thousand thousand thousand thousand
occupyin thousand
Yuan) Yuan) Yuan) Yuan)
g or not Yuan)
Debts payable to related party
Current
Balance at Current amount Balance at
Current
period- amount period-
Related Relationshi Causes of returned interest(10
begin(10 increased(1 Interest rate end(10
party p formation (10 thousand
thousand 0 thousand thousand
thousand Yuan)
Yuan) Yuan) Yuan)
Yuan)
Shenzhen
Guosheng Substantial Subsidiary
Energy sharehol Emmelle 650 0 0 0.00% 0 650
Investment der loan
Developme
68
nt Co., Ltd.
Influence on operation
result and financial statue
Not applicable
of the Company from
related debts
5. Contact with the related finance companies
□Applicable Not applicable
There are no deposits, loans, credits or other financial business between the finance companies with associated relationship and
related parties
6. Transactions between the finance company controlled by the Company and related parties
□Applicable Not applicable
There are no deposits, loans, credits or other financial business between the finance companies controlled by the Company and
related parties
7. Other material related transactions
□Applicable Not applicable
The company had no other material related transactions in reporting period.
XV. Significant contract and implementations
1. Trusteeship, contract and leasing
(1) Trusteeship
□Applicable Not applicable
No trusteeship occurred in reporting period.
(2) Contract
□Applicable Not applicable
No contract occurred in reporting period.
(3) Leasing
□Applicable Not applicable
No leasing occurred in reporting period.
2. Major guarantee
□Applicable Not applicable
69
No major guarantee occurred in reporting period.
Not applicable
3. Entrust others to cash asset management
(1) Trust financing
□Applicable Not applicable
No trust financing occurred in reporting period.
(2) Entrusted loans
□Applicable Not applicable
No entrusted loans occurred in reporting period.
4. Other material contracts
□Applicable Not applicable
No other material contracts occurred in reporting period.
XVI. Explanation on other significant events
Applicable □Not applicable
1. Planning for non-public offering of shares
In November 2022, the company completed the non-public offering of A-shares, raising funds of 294 million yuan, the registered
capital of the company increased from 551 million yuan to 689 million yuan, the overall net asset scale of the company was increased,
enhancing the fund strength, comprehensive competitiveness and anti-risk ability of the company. Wansheng Industrial totally holds
137,836,986 shares of the company through the subscription of non-public offering of shares, accounting for 20% of the total share
capital after the completion of the non-public offering. The newly increased shares by the company’s non-public offering was listed
on the Shenzhen Stock Exchange on November 7, 2022.
On November 28, 2022, the company completed the change of office term of the board of directors and the board of supervisors, and
the company was changed from a company without controlling shareholder and actual controller to a company with controlling
shareholder and actual controller, the controlling shareholder of the company was changed to Wansheng Industrial Holdings
(Shenzhen) Co., Ltd., and the actual controller of the company was changed to Mr. Wang Shenghong.
2. litigation matters
On February 23, 2022, the company received the Subpoena (2022) Yue 0303 Min Chu No. 3787, Complaint, Notice of Response,
Civil Ruling Paper (2020) Yue 0303 Zhi Bao No. 498 and other legal documents from Shenzhen Luohu District People’s Court,
which has accepted the lawsuit brought by the plaintiff Shenzhen Jianzhi Industrial Development Co., Ltd. against the company on
the grounds of “joint venture and cooperative development of real estate contract disputes”, the amount involved was 30.859 million
70
yuan. At the same time, the company also filed a countersuit against Shenzhen Jianzhi Industrial Development Co., Ltd., demanding
that it pay 6 million yuan in return for the project. The above case was held in People's Court of Luohu District, Shenzhen on the
morning of May 11, 2022. The countersuit and the suit were held at the same time, and no judgment was made in court. On August
19, 2022, the company received Civil Judgment (2022) Yue 0303 MC No. 3787 from the People's Court of Luohu District, Shenzhen,
Guangdong Province. For details, please refer to the Announcement on the Progress of Litigation Matters (Announcement No. 2022-
019) disclosed by the company at www.cninfo.com.cn on August 23, 2022. According to the first instance judgment of People's
Court of Luohu District, this case will not have a material adverse impact on the company's current or future profits. As of the date of
this announcement, the second trial has not been held, the company will timely fulfill the obligation of information disclosure
according to the progress of the litigation, please pay attention to the investment risk.
XVII. Significant event of subsidiary of the Company
□Applicable Not applicable
71
Section VII. Changes in Shares and Particulars about Shareholders
I. Changes in Share Capital
1. Changes in Share Capital
Unit: Share
Before the Change Increase/Decrease in the Change (+, -) After the Change
Capitaliza
New
Proportio Bonus tion of Proportio
Amount shares Others Subtotal Amount
n shares public n
issued
reserve
I.
137,836,9 137,838,3 137,842,2
Restricted 3,957 0.00% 0 0 1,319 20.00%
shares 86 05 62
1. State-
owned 0 0.00% 0 0 0 0 0 0 0.00%
shares
2. State-
owned
legal 0 0.00% 0 0 0 0 0 0 0.00%
person’s
shares
3. Other
137,836,9 137,838,3 137,842,2
domestic 3,957 0.00% 0 0 1,319 20.00%
shares 86 05 62
Including:
Domestic
137,836,9 137,836,9 137,836,9
legal 0 0.00% 0 0 20.00%
person’s 86 86 86
shares
Domestic
natural
3,957 0.00% 0 0 0 1,319 1,319 5,276 0.00%
person’s
shares
4. Foreign
0 0.00% 0 0 0 0 0 0 0.00%
shares
Including:
Foreign
legal 0 0.00% 0 0 0 0 0 0 0.00%
person’s
shares
Foreign
natural
0 0.00% 0 0 0 0 0 0 0.00%
person’s
shares
II.
551,343,9 551,342,6
Unrestrict 100.00% 0 0 0 -1,319 -1,319 80.00%
ed shares 90 71
1. RMB
302,981,0 302,979,6
Ordinary 54.95% 0 0 0 -1,319 -1,319 43.96%
shares 08 89
2.
Domestic
248,362,9 248,362,9
ally listed 45.05% 0 0 0 0 0 36.04%
foreign 82 82
shares
3.
Overseas
0 0.00% 0 0 0 0 0 0 0.00%
listed
foreign
72
shares
4. Others 0 0.00% 0 0 0 0 0 0 0.00%
III. Total 551,347,9 137,836,9 137,836,9 689,184,9
100.00% 0 0 0 100.00%
shares 47 86 86 33
Reasons for share changed
Applicable □Not applicable
1. During the reporting period, due to the non-public offering of 137,836,986 RMB ordinary shares (A stock), total share capital of
the Company up to 689,184,933 shares from 551,347,947 shares.
2. During the reporting period, the general election of BOS was completed. Mr. Zheng Zhonghuan, the supervisor of 9 th BOS was
outgoing for the offer-term expired dated November 28, 2022. According to the Management Regulation of the Shares held by
Director, Supervisor and Senior Executives of the Listed Companies and their Changes, the shares held by supervisor of the
Company shall not be transferred within 6 months after their resignation, resulting in an increase of 1,319 shares with sales restriction.
Approval of share changed
Applicable □Not applicable
According to the approval of Official Reply on Approval of Non-Public Offering of Shares of Shenzhen China Bicycle
Company(Holdings) Limited (ZJXK [2021] No.3552) from CSRC, during the reporting period, the Company offering RMB ordinary
A stock of 137,836,986 shares to Wansheng Industrial privately, the new shares were listed on Shenzhen Stock Exchange on 7
November 2022.
Ownership transfer of share changed
Applicable □Not applicable
1. During the reporting period, the registration procedure for the new shares from non-publicly offering are completed, which are
listed on Shenzhen Stock Exchange on 7 November 2022.
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common
shareholders of Company in latest year and period
Applicable □Not applicable
Other information necessary to disclose for the Company or need to disclosed under requirement from security regulators
□Applicable Not applicable
2. Changes of restricted shares
Applicable □Not applicable
Unit: Share
Shares Number of Number of Shares Cause of Dated of
Shareholder
restricted at shares shares released restricted at restriction released
73
period-begin restricted in the in the Period period-end
Period
The shares
Wansheng restricted after
Industrial initial
Holdings 0 137,836,986 0 137,836,986 placement(restr 2025-11-07
(Shenzhen) icted for the
Co., Ltd. non-public
offering)
Executive lock- 6 months after
Zheng
3,957 1,319 0 5,276 up stock outgoing when
Zhonghuan
(Supervisor) session expired
Total 3,957 137,838,305 0 137,842,262 -- --
II. Securities issuance and listing
1. Security offering (without preferred stock) in Reporting Period
Applicable □Not applicable
Offering
Stock and Number
Offering price (or Numbers Closing Disclosure Date of
derivative Listing date approved
date interest offering date index disclosure
securities for listing
rate)
Stock
Found
more at
Juchao
Website
(www.cninf
o.com.cn):
RMB
“Report of
ordinary 2.13 137,836,98 137,836,98
2022-10-20 2022-11-07 the Non- 2022-11-03
shares (A yuan/Share 6 6
public
stock)
Offering of
Shares and
Notice of
Listing”
and other
Notices
Convertible bonds, separately traded convertible bonds and corporate bonds
Other derivatives securities
Explanation:
Non-public offering of shares:
1. On December 14, 2020, the company held the 27th (interim) Meeting of the Tenth Board of Directors, and deliberated and
approved the Proposal on the Company Meeting the Conditions for the Non-public Offering of A-Shares, the Proposal on the Plan
for the Company's Non-public Offering of A-Shares, the Proposal on the Plan for the Non-public Offering of A-Shares of Shenzhen
China Bicycle Company (Holdings) Limited, the Proposal on the Feasibility Analysis Report on the Use of Funds Raised by Non-
Public Offering of A-Shares of Shenzhen China Bicycle Company (Holdings) Limited, the Proposal That There Is No Need for the
Company to Prepare a Report on the Use of the Previously Raised Funds, the Proposal on Risk Tips on Diluted Immediate Returns of
Non-Public Offering of A-Shares, Explanations on Taking Filling Measures and Commitments of Relevant Subjects, the Proposal on
74
Requesting the General Meeting of Shareholders of the Company to Authorize the Board of Directors to Handle Matters Related to
the Non-public Offering of A-Shares with Full Authority, and other matters related to the non-public offering of shares.
2. On December 30, 2020, the company held the Third Interim General Meeting of Shareholders in 2020, deliberated and approved
the relevant proposals on the private offering, and authorized the board of directors to handle the relevant matters of the private
offering.
3. On December 7, 2021, the company held the 36th (interim) Meeting of the Tenth Board of Directors, deliberated and approved the
Proposal on Extending the Validity Period of the Resolution on the Company's Non-public Offering of A-Shares and Extending the
Validity Period of Authorizing the Board of Directors to Handle Matters Related to the Non-public Offering of A-Shares, extending
the validity period of the resolution on the non-public offering of A-shares and the validity period of the general meeting of
shareholders authorizing the board of directors to handle all matters related to the non-public offering of A-shares by 12 months from
the expiration date, namely to December 29, 2022.
4. On December 23, 2021, the company held the Second Interim General Meeting of Shareholders in 2021, deliberated and approved
the Proposal on Extending the Validity Period of the Resolution on the Company's Non-public Offering of A-Shares and Extending
the Validity Period of Authorizing the Board of Directors to Handle Matters Related to the Non-public Offering of A-Shares.
5. On October 25, 2021, the non-public offering of shares by the issuer was approved by the Issuance Examination Committee of the
China Securities Regulatory Commission.
6. On November 9, 2021, the China Securities Regulatory Commission issued an approval letter (ZJXK (2021) No. 3552) to the
issuer, approving the non-public offering of no more than 137,836,986 new shares by the issuer. The approval will be valid for 12
months from the date of approval.
7. On October 21, 2022, Baker Tilly China Certified Public Accountants (Special General Partnership) issued the Capital Verification
Report on the Fund Allocation of Non-Public Offering of A Shares of Shenzhen China Bicycle Company (Holdings) Limited
TZYZ[2022] No.42018. According to the aforementioned report, as of December 21, 2022, the company had made a private offering
of 137,836,986.00 A-shares, totally raising funds of 293,592,780.18 yuan. After deducting the issuance expenses (excluding VAT) of
4,765,621.08 yuan, the actual net fund raised by the company was 288,827,159.10 yuan.
8. The company has obtained the Confirmation of Acceptance of Application for Share Registration issued by Shenzhen Branch of
China Securities Depository and Clearing Co., Ltd. on October 26, 2022, and completed the initial public offering of new shares on
the Shenzhen Stock Exchange on November 7, 2022. Upon completion of the offering, the total share capital of the company
increased from 551,347,947 shares to 689,184,933 shares.
9. On November 7, 2022, the company’s non-public offering of shares were listed on the Shenzhen Stock Exchange.
2. Changes of total shares and shareholders structure as well as explanation on changes of assets and
liability structure
Applicable □Not applicable
(1)Impact of the non-public offering of share on share capital structure of the Company
After the completion of the private offering, the total capital of the company increased to 689,184,933 shares. At the same time, the
75
non-public offering resulted in the change of the control of the company, the company was changed from a company without
controlling shareholder and actual controller to a company with controlling shareholder and actual controller, the controlling
shareholder of the company was changed to Wansheng Industrial, and the actual controller of the company was changed to Mr. Wang
Shenghong. The changes of the company's share capital structure before and after the non-public offering are as follows:
Before offering After offering
Type Number of shares Ratio in total share Number of shares Ratio in total share
(Share) capital (Share) capital
1. Restricted shares 3,957 0.00% 137,842,262 20%
2.Unrestricted shares 551,343,990 100.00% 551,342,671 80%
3.Total shares 551,347,947 100.00% 689,184,933 100%
After the completion of the private offering, the company's equity distribution conforms to the listing conditions stipulated in the
Shenzhen Stock Exchange Listing Rules.
(2) The impact of private offering on the structure of assets and liabilities
After the completion of the private offering, the total assets and net assets of the company have been increased, and the asset-liability
ratio has decreased correspondingly. The company's operating strength is enhanced, financial structure is more reasonable, debt
paying ability is significantly improved and financing ability is increased, which are conducive to reducing the company's financial
risks and improving the company's comprehensive strength and anti-risk ability.
3. Existing internal staff shares
□Applicable Not applicable
III. Shareholders and actual controller of the Company
1. Amount of shareholders and particulars about shares holding
Unit: Share
Total
preferred
Total shareholder
common s with Total preferred
Total shareholder voting shareholders with voting
common s at end of rights rights recovered at end of
shareholder 46,210 last month 46,761 recovered 0 last month before annual 0
s at end of before at end of report disclosed (if
the Period annual reporting applicable) (found in note
report period (if 8)
disclosed applicable)
(found in
note 8)
Particulars about shares held above 5% by shareholders or top ten shareholders
Total Information of shares
Full name Amount of
Proportion shareholder Changes in Amount of
of Nature of un- pledged, tagged or frozen
of shares s at the end report restricted
Shareholde shareholder restricted State of
held of report period shares held Amount
rs shares held share
period
Wansheng Domestic 137,836,98 137,836,98 137,836,98
20.00% 0
Industrial non-state- 6 6 6
76
Holdings owned
(Shenzhen) legal
Co., Ltd. person
Shenzhen
Domestic
Guosheng
non-state-
Energy
owned 9.22% 63,508,747 0 0 63,508,747
Investment
legal
Developme
person
nt Co., Ltd.
UOB Kay
Foreign
Hian (Hong
legal 2.31% 15,907,850 0 0 15,907,850
Kong)
person
Limited
Guosen
Securities Foreign
(HK) legal 2.02% 13,909,425 0 0 13,909,425
Brokerage person
Co., Ltd.
Shenwan
Hongyuan
Foreign
Securities
legal 1.20% 8,281,156 0 0 8,281,156
(Hong
person
Kong) Co.,
Ltd.
Lhasa Domestic
Xingqing non-state-
Network owned 0.67% 4,600,255 0 0 4,600,255
Technology legal
Co., Ltd. person
Domestic
Li Huili nature 0.56% 3,891,124 0 0 3,891,124
person
Domestic
Ge
nature 0.44% 3,050,452 -474,700 0 3,050,452
Zhiqiong
person
Domestic
Xu Hongbo nature 0.42% 2,927,319 0 0 2,927,319
person
China
Merchants Foreign
Securities legal 0.42% 2,894,135 0 0 2,894,135
(HK) Co., person
Ltd
Strategy investors or
general corporation comes
top 10 common stock
N/A
shareholders due to
placement of new shares
(if applicable) (see note 3)
Li Huili, spouse of Ji Hanfei, the actual controller of Shenzhen Guosheng Energy Investment
Development Co., Ltd., holding B-share of the Company on behalf of Shenzhen Guosheng Energy
Explanation on associated
Investment Development Co., Ltd., other than that, the Company does not know whether the other
relationship among the
outstanding shareholders are related and whether the shareholders belong to persons acting in
aforesaid shareholders
concert regulated in the Administration of Disclosure of Information on the Change of Shareholders
in Listed Companies.
Description of the above
N/A
shareholders in relation to
77
delegate/entrusted voting
rights and abstention from
voting rights.
Special note on the
repurchase account among
N/A
the top 10 shareholders (if
applicable) (see note 10)
Particular about top ten shareholders with un-restrict shares held
Type of shares
Shareholders’ name Amount of un-restrict shares held at Period-end
Type Amount
Shenzhen Guosheng RMB
Energy Investment 63,508,747 common 63,508,747
Development Co., Ltd. shares
Domestical
UOB Kay Hian (Hong ly listed
15,907,850 15,907,850
Kong) Limited foreign
shares
Domestical
Guosen Securities (HK) ly listed
13,909,425 13,909,425
Brokerage Co., Ltd. foreign
shares
Domestical
Shenwan Hongyuan
ly listed
Securities (Hong Kong) 8,281,156 8,281,156
foreign
Co., Ltd.
shares
RMB
Lhasa Xingqing Network
4,600,255 common 4,600,255
Technology Co., Ltd.
shares
Domestical
ly listed
Li Huili 3,891,124 3,891,124
foreign
shares
Domestical
ly listed
Ge Zhiqiong 3,050,452 3,050,452
foreign
shares
Domestical
ly listed
Xu Hongbo 2,927,319 2,927,319
foreign
shares
Domestical
China Merchants ly listed
2,894,135 2,894,135
Securities (HK) Co., Ltd foreign
shares
RMB
Shenzhen China Bicycle common 1,383,313
Company (Holdings) shares
Limited -Special account 2,602,402 Domestical
for property disposal of ly listed
1,219,089
bankrupt enterprise foreign
shares
Expiation on associated Li Huili, spouse of Ji Hanfei, the actual controller of Shenzhen Guosheng Energy Investment
relationship or consistent Development Co., Ltd., holding B-share of the Company on behalf of Shenzhen Guosheng Energy
actors within the top 10 Investment Development Co., Ltd., other than that, the Company does not know whether the other
un-restrict shareholders outstanding shareholders are related and whether the shareholders belong to persons acting in
and between top 10 un- concert regulated in the Administration of Disclosure of Information on the Change of Shareholders
restrict shareholders and in Listed Companies.
78
top 10 shareholders
Explanation on top 10
shareholders involving
N/A
margin business (if
applicable) (see note 4)
Whether top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held have a buy-back
agreement dealing in reporting period
□Yes No
The top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held of the Company have no
buy-back agreement dealing in reporting period.
2. Controlling shareholder of the Company
Nature of controlling shareholders: controlled by natural person
Type of controlling shareholders: Legal person
Controlling Legal person
Establishment date Organizational Code Main business
shareholder /Responsible person
Wansheng Industrial Investment in industry
91440300MA5DCB5K
Holdings (Shenzhen) Wang Shenghong 10 May 2016 (Separately declared
9A
Co., Ltd. for specific item)
Shareholdings in other
listed companies in and
out of China that
controlled and N/A
participated by the
controlling shareholder
during reporting period
Changes of controlling shareholders in reporting period
Applicable □Not applicable
New controlling shareholder Wansheng Industrial Holdings (Shenzhen) Co., Ltd.
Date of change 2022-11-28
Found more in the Prompt Announcement on Change of the
Designated website for query index Controlling Shareholder and Actual Controller of the Company
Notice No.: 2022043 on Juchao Website (www.cninfo.com.cn)
Date of disclosure on designated website 29 November 2022
3. Actual controller and persons acting in concert
Nature of actual controller:Domestic nature person
Type of actual controller: Natural person
Whether to obtain the
Relationship with the actual
Actual controller Nationality residency in other countries or
controller
regions
Wang Shenghong The person himself P.R.C No
Principal occupation and
Wang Shenghong currently is the Chairman of the Company
position
The listed companies in and N/A
79
out of China that controlled
by Wang in the past 10 years
Changes of actual controller in reporting period
Applicable □Not applicable
Former actual controller No actual controller
New actual controller Wang Shenghong
Date of change 2022-11-28
Found more in the Prompt Announcement on Change of the
Designated website for query index Controlling Shareholder and Actual Controller of the Company
Notice No.: 2022043 on Juchao Website (www.cninfo.com.cn)
Date of disclosure on designated website 29 November 2022
Property right and controlling relationship between the actual controller and the Company is as follow:
Actual controller controlling the Company by entrust or other assets management
□Applicable Not applicable
4. The total number of shares pledged by controlling shareholders or the first majority shareholder and its
persons acting in concert accounts for 80% of the shares held by them
□Applicable Not applicable
5. Particulars about other legal person shareholders with over 10% shares held
□Applicable Not applicable
6. Limitation and reducing the holdings of shares of controlling shareholders, actual controllers,
restructuring side and other commitment subjects
□Applicable Not applicable
80
IV. The specific implementation of shares buy-back during the reporting period
Implementation progress of shares buy-back
□Applicable Not applicable
Implementation progress of the reduction of repurchases shares by centralized bidding
□Applicable Not applicable
81
Section VIII. Preferred Stock
□Applicable Not applicable
The Company had no preferred stock in the Period.
82
Section IX. Corporate Bonds
□Applicable Not applicable
83
Section X. Financial Report
I. Audit Report
Type of audit opinion Standard Unqualified Opinion
Signing date of audit report 21 April 2023
Name of audit institute Baker Tilly China CPA (LLP)
Document serial of audit report Baker Tilly Zi[2023]No.:11694
Name of the CPA Qu Xianfu, Deng Jun
Audit report
Baker Tilly Zi[2023]No.:11694
To Shareholders of Shenzhen China Bicycle Company (Holdings) Limited
I. Auditor’s opinion
We have audited the financial statements under the name of Shenzhen China Bicycle Company (Holdings)
Limited (hereinafter the “CBC Company”), which included the consolidated and parent company’s balance sheet
as of 31 December 2022, the consolidated and parent company’s profit statement, the consolidated and parent
company’s statement of cash flow and the consolidated statement of changes in equity of the Company and parent
company’s for the year of 2022, together with the relevant annotations thereto.
We have the view that the attached financial statements are prepared in accordance with the Accounting Standards
for Business Enterprises in all material aspects, which reflect fairly the consolidated financial position of the
Company and parent company’s as of 31 December 2022 and the operating results and cash flow of the Company
and parent company’s for the year of 2022.
II. Basis for audit opinions
We conducted this audit under the requirements of the Auditing Standards of the Certified Public Accountant of
the PRC. The section headed “Certified Public Accountant’s responsibility for audit of financial statement” in the
audit report has further clarified our responsibilities under these standards. Pursuant to the code of professional
conduct as certified public accountant in the PRC, we are independent of the CBC Company and have performed
other responsibility as required by our professional ethics. We believe that the audit evidence obtained by us is
sufficient and adequate, which provides foundation for us to issue audit opinion.
III. Key audit items
Key audit items refer to those which in our opinion based on our professional judgment are the most important
issues in respect of audit for the current financial statements. We issue audit opinions on these issues in their entity
84
and provide no opinions separately for each of them.
85
Key audit items Countermeasures
1. Revenue recognition
The CBC Company is mainly engaged in the sales of The main audit procedures we performed for revenue
bicycles, electric bicycles and related materials, jewelry recognition are as follows:
and accessories. In 2022, revenue from main business
1. Understand, evaluate and test the effectiveness of the
was441,648,114.02yuan, all of which was generated from
design and operation of internal control related to sales
domestic sales. CBC Company recognizes the sales
and collection of Shenzhen China Bicycle Company.
revenue when the products are shipped and signed for by
the customers. Due to the significant amount of operation 2. Check the relevant terms of the customer contract,
revenue, the veracity of the revenue and whether it is concern whether the pricing method, acceptance method,
included in the proper accounting period has a significant delivery place and lead time, settlement method, etc. have
impact on the Company’ results of operation for 2022, changed, and evaluate whether the revenue recognition of
and may be subject to the potential misstatement. CBC Company complies with the provisions of the
Accordingly, we have identified the revenue recognition Accounting Standards for Business Enterprises and
as a key audit matter. whether it is consistent with the disclosed accounting
policies .
3. Inquire and understand the background information of
major customers through public channels, such as
industrial and commercial registration information, to
Please refer to the accounting policies described in "28.
confirm whether there is a potential unidentified related
Revenue" in Note "III. Significant Accounting Policies
party relationship between the customer and Shenzhen
and Accounting Estimates" to the Financial Statements,
China Bicycle Company and related parties.
and "25. Operation Revenue and Costs" in "VI. Notes to
4. Check the online sales customer information (such as
Items in the Consolidated Financial Statements".
contact number, contact address, order time, etc.) to
evaluate the authenticity and rationality of online sales;
check the market prices of main materials, and analyze
the rationality of fluctuations in gross profit margins.
5. Confirm the current transaction amount and payment
balance to major customers, and visit important
customers to verify the authenticity of the revenue
recognition of Shenzhen China Bicycle Company.
6. Check the main customer contracts, incoming and
outgoing records, delivery notes and delivery receipt
records, etc.
7. Check the delivery notes within a certain period before
and after the balance sheet date, pay attention to the date
of receipt, and confirm whether the revenue recognition is
included in the correct accounting period.
86
Key audit items Countermeasures
2. Impairment of account receivable
As of December 31, 2022, balance of account receivable Our main audit procedures for the impairment of account
under the name of CBC Company was 272,323,748.95 receivable are as follows:
yuan, balance of bad debt provision was 22,254,447.02 1. Understand and test the effectiveness of the design and
yuan. Due to the significant amount of account receivable operation of internal control related to account receivable
and the assessment of the bad debt provision involves management.
significant management judgment. Accordingly, we 2. Review the rationality and consistency of the
identified the impairment of account receivable as a key management’s accounting policies for the provision for
audit matter. bad debts of account receivable, and review whether the
major standards of single amount determined by the
management are reasonable.
3. For account receivable with separate provision for bad
debts, select samples to obtain the basis for the
Please refer to the accounting policies described in "12.
management to estimate the expected future recoverable
Account receivable" in Note "III. Significant Accounting
amount, including customer credit records, default or
Policies and Accounting Estimates" to the financial delayed payment records and actual repayment after the
statements, and "3. Account receivable" in "VI. Notes to period, and review its rationality.
Items in the Consolidated Financial Statements" 4. For the account receivable for which the bad debt
provision is made according to the aging analysis method,
analyze the rationality of the accounting estimate of the
bad debt provision for the account receivable of
Shenzhen China Bicycle Company, and select samples to
test the accuracy of the aging.
IV. Other information
The management of CBC Company (hereinafter, the Management) is responsible for other information, which
includes the information covered in the Annual Report of 2022 except for the financial statements and our audit
report.
Our audit opinion issued on financial statement does not cover other information, and we would not issue any
form of verification conclusion for those information.
To prepare our audit on financial statement, we are required to read other information, and during the procedure,
to consider that whether other information differs materially from the financial statement or the information
obtained by us during the audit or whether there exits material error.
Based on the works done by us, in case we find any material error in other information, we shall report this fact.
87
In this regard, we have nothing to report.
V.Management’s responsibility for financial statement
The Management is responsible for preparing financial statements according to the Business Accounting
Standards which make fair reflection, and for designing, implementing and maintaining necessary internal control
system to make sure that there is no material misstatement in the financial statements due to fraud or mistake.
When preparing the financial statements, the management is responsible for assessing the Company’s ability of
continuous operation, disclosing the matters relating to continuous operation (if applicable) and applying the
assumption of continuous operation, unless the management plans to liquidate the Company, terminate operation
or has no other practicable choice.
The governance is responsible for monitoring the financial reporting process of the CBC Company.
VI. Auditor’s responsibility for audit of the financial statements
Our objectives are to obtain reasonable assurance about whether these financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with auditing standards will always be found in the presence of a material misstatement.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the basis of these financial
statements.
As part of an audit in accordance with auditing standards, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by management.
88
(4) Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in these
financial statements or, if such disclosures are inadequate, we have to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Company to cease to continue as a going concern.
(5) Evaluate the overall presentation, structure and content of the financial statements, and whether the financial
statements represent the underlying transactions and events in a manner that achieves fair presentation.
(6) Obtain adequate and appropriate audit evidence in relation to the financial information of the entities or
business transactions of the Company, in order to issue audit opinion on the financial statement. We are
responsible for guiding, supervising and executing the audit for the Group, and we accept full responsibility for
the audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and related safeguards (if applicable).
From the matters communicated with those charged with governance, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure
about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
II. Financial statement
Unit in note of financial statement refers to CNY: RMB (Yuan)
1. Consolidated Balance Sheet
Prepared by Shenzhen China Bicycle Company (Holdings) Limited
December 31, 2022
89
Unit: RMB/CNY
Item December 31, 2022 January 1, 2022
Current assets:
Monetary fund 54,699,491.18 33,246,957.92
Settlement provisions
Capital lent
Trading financial assets
Derivative financial assets
Note receivable 1,102,000.00
Account receivable 250,069,301.93 46,850,083.59
Receivable financing
Accounts paid in advance 4,286,935.15 1,300,408.57
Insurance receivable
Reinsurance receivables
Contract reserve of reinsurance
receivable
Other account receivable 438,477.82 494,695.27
Including: Interest receivable
Dividend receivable
Buying back the sale of financial
assets
Inventory 48,206,866.81 8,248,573.77
Contractual assets
Assets held for sale
Non-current asset due within one year
Other current assets 35,453,106.62 1,814,200.53
Total current assets 394,256,179.51 91,954,919.65
Non-current assets:
Loans and payments on behalf
Debt investment
Other debt investment
Long-term account receivable
Long-term equity investment
Investment in other equity instrument
Other non-current financial assets
Investment real estate
Fix assets 2,304,402.38 3,439,212.00
Construction in progress
Productive biological asset
Oil and gas asset
Right-of-use assets 173,936.71 1,505,258.90
Intangible assets
Expense on Research and
90
Development
Goodwill
Long-term expenses to be apportioned
Deferred income tax asset 118,969.33 64,046.67
Other non-current assets 400,000.00 400,000.00
Total non-current assets 2,997,308.42 5,408,517.57
Total assets 397,253,487.93 97,363,437.22
Current liabilities:
Short-term loans
Loan from central bank
Capital borrowed
Trading financial liability
Derivative financial liability
Note payable
Account payable 2,877,423.23 8,297,306.34
Accounts received in advance
Contractual liability 791,762.84 124,328.07
Selling financial asset of repurchase
Absorbing deposit and interbank
deposit
Security trading of agency
Security sales of agency
Wage payable 769,992.42 923,477.10
Taxes payable 38,144,508.36 911,506.52
Other account payable 48,621,087.98 61,407,301.04
Including: Interest payable
Dividend payable
Commission charge and commission
payable
Reinsurance payable
Liability held for sale
Non-current liabilities due within one
210,892.38 1,456,782.04
year
Other current liabilities 102,929.16 11,700.06
Total current liabilities 91,518,596.37 73,132,401.17
Non-current liabilities:
Insurance contract reserve
Long-term loans
Bonds payable
Including: Preferred stock
Perpetual bonds
Lease liability 228,302.37
Long-term account payable
91
Long-term wages payable
Accrual liability 887,342.00
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 887,342.00 228,302.37
Total liabilities 92,405,938.37 73,360,703.54
Owner’s equity:
Share capital 689,184,933.00 551,347,947.00
Other equity instrument
Including: Preferred stock
Perpetual bonds
Capital public reserve 778,824,470.95 627,834,297.85
Less: Inventory shares
Other comprehensive income
Reasonable reserve
Surplus public reserve 32,673,227.01 32,673,227.01
Provision of general risk
Retained profit -1,210,553,312.45 -1,202,936,933.70
Total owner’ s equity attributable to
290,129,318.51 8,918,538.16
parent company
Minority interests 14,718,231.05 15,084,195.52
Total owner’ s equity 304,847,549.56 24,002,733.68
Total liabilities and owner’ s equity 397,253,487.93 97,363,437.22
Legal Representative: Li Hai Person in charge of Accounting Works: Sun Longlong Person in charge of Accounting
Institution: She Hanxing
2. Balance Sheet of Parent Company
Unit: RMB/CNY
Item December 31, 2022 January 1, 2022
Current assets:
Monetary fund 44,090,324.53 7,613,043.60
Trading financial assets
Derivative financial assets
Note receivable 400,000.00
Account receivable 213,762,895.33 22,842,513.86
Receivable financing
Accounts paid in advance 39,465,026.86 586,425.80
Other account receivable 209,606.79 70,451.01
Including: Interest receivable
Dividend receivable
Inventory 42,640,812.21 73,037.28
Contractual assets
Assets held for sale
Non-current asset due within one year
Other current assets 1,814,200.53
92
Total current assets 340,568,665.72 32,999,672.08
Non-current assets:
Debt investment
Other debt investment
Long-term account receivable
Long-term equity investment 19,960,379.73 19,960,379.73
Investment in other equity instrument
Other non-current financial assets
Investment real estate
Fix assets 2,209,564.35 3,265,329.99
Construction in progress
Productive biological asset
Oil and gas asset
Right-of-use assets 105,403.37 421,613.45
Intangible assets
Expense on Research and
Development
Goodwill
Long-term expenses to be apportioned
Deferred income tax asset
Other non-current assets 400,000.00 400,000.00
Total non-current assets 22,675,347.45 24,047,323.17
Total assets 363,244,013.17 57,046,995.25
Current liabilities:
Short-term loans
Trading financial liability
Derivative financial liability
Note payable
Account payable 275,843.19 364,394.75
Accounts received in advance
Contractual liability 90,000.44
Wage payable 403,771.82 561,350.41
Taxes payable 35,797,995.48 15,603.18
Other account payable 40,465,510.28 52,710,433.54
Including: Interest payable
Dividend payable
Liability held for sale
Non-current liabilities due within one
121,977.23 323,646.60
year
Other current liabilities 11,700.06
Total current liabilities 77,065,098.00 54,077,128.98
Non-current liabilities:
Long-term loans
93
Bonds payable
Including: Preferred stock
Perpetual bonds
Lease liability 121,974.19
Long-term account payable
Long-term wages payable
Accrual liability 878,000.00
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 878,000.00 121,974.19
Total liabilities 77,943,098.00 54,199,103.17
Owner’s equity:
Share capital 689,184,933.00 551,347,947.00
Other equity instrument
Including: Preferred stock
Perpetual bonds
Capital public reserve 778,824,470.95 627,834,297.85
Less: Inventory shares
Other comprehensive income
Reasonable reserve
Surplus public reserve 32,673,227.01 32,673,227.01
Retained profit -1,215,381,715.79 -1,209,007,579.78
Total owner’ s equity 285,300,915.17 2,847,892.08
Total liabilities and owner’ s equity 363,244,013.17 57,046,995.25
3. Consolidated Profit Statement
Unit: RMB/CNY
Item 2022 2021
I. Total operation revenue 444,762,238.25 165,246,577.95
Including: Operation revenue 444,762,238.25 165,246,577.95
Interest income
Insurance gained
Commission charge and
commission income
II. Total operation cost 434,584,382.03 164,230,093.26
Including: Operation cost 416,884,753.17 152,606,986.59
Interest expense
Commission charge and
commission expense
Cash surrender value
Net amount of expense of
compensation
Net amount of withdrawal of
insurance contract reserve
Bonus expense of guarantee
94
slip
Reinsurance expense
Tax and surcharge 3,757,974.70 116,707.39
Sales expenses 5,688,257.68 3,303,956.30
Administrative expenses 7,525,176.16 6,154,605.29
R&D expenses 924,567.70 2,037,197.58
Financial expenses -196,347.38 10,640.11
Including: Interest expenses
Interest income 272,353.25 127,249.64
Add: Other income 146,351.13 400,392.20
Investment income (Loss is listed
with “-”)
Including: Investment
income on affiliated company and joint
venture
The termination of
income recognition for financial assets
measured by amortized cost
Exchange income (Loss is listed
with “-”)
Net exposure hedging income
(Loss is listed with “-”)
Income from change of fair value
(Loss is listed with “-”)
Loss of credit impairment (Loss
-15,516,772.44 -2,398,980.61
is listed with “-”)
Impairment loss on assets(Loss is
-840,361.84 -99,941.65
listed with “-”)
Income from assets disposal
-16,957.53
(Loss is listed with “-”)
III. Operation profit (Loss is listed with
-6,049,884.46 -1,082,045.37
“-”)
Add: Non-operating income 4,081,450.75 5,680,409.27
Less: Non-operating expense 4,744,024.13 5,303,959.22
IV. Total profit (Loss is listed with “-”) -6,712,457.84 -705,595.32
Less: Income tax expense 1,269,885.38 933,960.68
V. Net profit (Net loss is listed with “-”) -7,982,343.22 -1,639,556.00
(i) Classify by business continuity
1.Continuous operating net profit
-7,982,343.22 -1,639,556.00
(net loss listed with ‘-”)
2.Termination of net profit (net loss
listed with ‘-”)
(ii) Classify by ownership
1.Net profit attributable to
-7,616,378.75 -1,986,692.82
shareholders of parent company
2.Minority shareholders’ gains and
-365,964.47 347,136.82
losses
VI. Net other comprehensive income
after taxation
95
Net other comprehensive income
attributable to owners of parent company
after taxation
(i) Other comprehensive income
items which will not be reclassified
subsequently to profit of loss
1.Changes of the defined benefit
plans that re-measured
2.Other comprehensive income
under equity method that cannot be
transfer to gain/loss
3.Change of fair value of
investment in other equity instrument
4.Fair value change of
enterprise's credit risk
5. Other
(ii) Other comprehensive income
items which will be reclassified
subsequently to profit or loss
1.Other comprehensive income
under equity method that can transfer to
gain/loss
2.Change of fair value of other
debt investment
3.Amount of financial assets re-
classify to other comprehensive income
4.Credit impairment provision for
other debt investment
5.Cash flow hedging reserve
6.Translation differences arising
on translation of foreign currency
financial statements
7.Other
Net other comprehensive income
attributable to minority shareholders
after taxation
VII. Total comprehensive income -7,982,343.22 -1,639,556.00
Total comprehensive income
attributable to owners of parent -7,616,378.75 -1,986,692.82
Company
Total comprehensive income
-365,964.47 347,136.82
attributable to minority shareholders
VIII. Earnings per share:
(i)Basic EPS -0.013 -0.004
(ii)Diluted EPS -0.013 -0.004
As for the enterprise combined under the same control, net profit of 0 Yuan achieved by the merged party before combination
while 0 Yuan achieved last period.
Legal Representative: Li Hai Person in charge of Accounting Works: Sun Longlong Person in charge of Accounting
Institution: She Hanxing
4. Profit Statement of Parent Company
Unit: RMB/CNY
Item 2022 2021
96
I.Operation revenue 267,241,929.51 28,199,223.50
Less:Operation cost 253,488,605.37 24,333,256.69
Tax and surcharge 3,606,282.77 18,043.30
Sales expenses 489,404.45 688,541.79
Administrative expenses 2,191,110.35 1,765,358.61
R&D expenses 396,209.62 2,037,197.58
Financial expenses -40,271.90 -56,830.88
Including: Interest expenses 15,022.20 30,342.02
Interest income 60,656.53 97,007.00
Add: Other income 126,559.52 392,001.91
Investment income (Loss is listed
with “-”)
Including: Investment income
on affiliated company and joint venture
The termination of
income recognition for financial assets
measured by amortized cost(Loss is
listed with “-”)
Net exposure hedging income
(Loss is listed with “-”)
Income from change of fair value
(Loss is listed with “-”)
Loss of credit impairment (Loss
-11,110,711.22 -2,700,794.63
is listed with “-”)
Impairment loss on assets(Loss is
-729,605.75 72,937.26
listed with “-”)
Income from assets disposal
-16,957.53
(Loss is listed with “-”)
II. Operation profit(Loss is listed with “-
-4,620,126.13 -2,822,199.05
”)
Add: Non-operating income 4,078,353.41 5,587,466.85
Less: Non-operating expense 4,715,083.72 5,182,300.00
III. Total profit (Total losses are listed
-5,256,856.44 -2,417,032.20
with “-”)
Less: Income tax expense 1,117,279.57
IV. Net profit (Net loss is listed with “-”) -6,374,136.01 -2,417,032.20
(i)Continuous operating net profit (net
-6,374,136.01 -2,417,032.20
loss listed with ‘-”)
(ii)Termination of net profit (net loss
listed with ‘-”)
V. Net other comprehensive income after
taxation
(i) Other comprehensive income
items which will not be reclassified
subsequently to profit of loss
1.Changes of the defined benefit
plans that re-measured
2.Other comprehensive income
under equity method that cannot be
97
transfer to gain/loss
3.Change of fair value of
investment in other equity instrument
4.Fair value change of
enterprise's credit risk
5. Other
(ii) Other comprehensive income
items which will be reclassified
subsequently to profit or loss
1.Other comprehensive income
under equity method that can transfer to
gain/loss
2.Change of fair value of other
debt investment
3.Amount of financial assets re-
classify to other comprehensive income
4.Credit impairment provision for
other debt investment
5.Cash flow hedging reserve
6.Translation differences arising
on translation of foreign currency
financial statements
7.Other
VI. Total comprehensive income -6,374,136.01 -2,417,032.20
VII. Earnings per share:
(i)Basic EPS
(ii)Diluted EPS
5. Consolidated Cash Flow Statement
Unit: RMB/CNY
Item 2022 2021
I. Cash flows arising from operating
activities:
Cash received from selling
commodities and providing labor 280,153,474.61 187,241,639.89
services
客 Net increase of customer deposit
and interbank deposit
Net increase of loan from central bank
Net increase of capital borrowed from
other financial institution
Cash received from original insurance
contract fee
Net cash received from reinsurance
business
Net increase of insured savings and
investment
Cash received from interest,
commission charge and commission
Net increase of capital borrowed
Net increase of capital from
repurchase business
Net cash received by agents in sale
98
and purchase of securities
Write-back of tax received 211,285.93 51,574.09
Other cash received concerning
9,804,457.72 20,966,639.22
operating activities
Subtotal of cash in-flow arising from
290,169,218.26 208,259,853.20
operation activity
Cash paid for purchasing commodities
522,417,130.69 169,402,197.88
and receiving labor service
Net increase of customer loans and
advances
Net increase of deposits in central
bank and interbank
Cash paid for original insurance
contract compensation
Net increase of capital lent
Cash paid for interest, handling charge
and commission
Cash paid for bonus of guarantee slip
Cash paid to/for staff 5,682,412.88 8,534,075.79
Taxes paid 1,289,781.65 816,292.62
Other cash paid concerning operating 22,198,959.07
13,833,354.04
activities
Subtotal of cash out-flow arising from 551,588,284.29
192,585,920.33
operation activity
Net cash flow arising from operating -261,419,066.03
15,673,932.87
activities
II. Cash flows arising from investing
activities:
Cash received from recovering
investment
Cash received from investment
income
Net cash received from disposal of
fixed, intangible and other long-term 50,000.00
assets
Net cash received from disposal of
subsidiaries and other units
Other cash received concerning
investing activities
Subtotal of cash in-flow arising from
50,000.00
investment activity
Cash paid for purchasing fixed,
40,164.10 18,890.56
intangible and other long-term assets
Cash paid for investment
Net increase of mortgaged loans
Net cash received from subsidiaries
and other units obtained
Other cash paid concerning investing
activities
Subtotal of cash out-flow arising from
40,164.10 18,890.56
investment activity
Net cash flow arising from investment
9,835.90 -18,890.56
activities
III. Cash flows arising from financing
activities:
99
Cash received from absorbing
290,292,780.18
investment
Including: Cash received from
absorbing minority shareholders’
investment by subsidiaries
Cash received from loans
Other cash received concerning
9,000,000.00
financing activities
Subtotal of cash in-flow arising from
299,292,780.18
financing activity
Cash paid for settling debts
Cash paid for dividend and profit
distributing or interest paying
Including: Dividend and profit of
minority shareholder paid by subsidiaries
Other cash paid concerning financing
20,207,638.62 2,296,062.44
activities
Subtotal of cash out-flow arising from
20,207,638.62 2,296,062.44
financing activity
Net cash flow arising from financing
279,085,141.56 -2,296,062.44
activities
IV. Influence on cash and cash
equivalents due to fluctuation in
exchange rate
V. Net increased amount of cash and cash
17,675,911.43 13,358,979.87
equivalent
Add: Balance of cash and cash
33,246,957.92 19,887,978.05
equivalents at the period -begin
VI. Balance of cash and cash equivalents
50,922,869.35 33,246,957.92
at the period -end
6. Cash Flow Statement of Parent Company
Unit: RMB/CNY
Item 2022 2021
I. Cash flows arising from operating
activities:
Cash received from selling
commodities and providing labor 99,421,799.26 25,119,322.27
services
Write-back of tax received
Other cash received concerning
26,085,946.66 22,351,912.54
operating activities
Subtotal of cash in-flow arising from
125,507,745.92 47,471,234.81
operation activity
Cash paid for purchasing commodities
336,871,285.17 21,110,201.92
and receiving labor service
Cash paid to/for staff 1,220,883.46 5,707,424.68
Taxes paid 460,792.02 175,913.72
Other cash paid concerning operating
34,421,627.82 21,881,881.87
activities
Subtotal of cash out-flow arising from
372,974,588.47 48,875,422.19
operation activity
Net cash flow arising from operating
-247,466,842.55 -1,404,187.38
activities
II. Cash flows arising from investing
100
activities:
Cash received from recovering
investment
Cash received from investment
income
Net cash received from disposal of
fixed, intangible and other long-term 50,000.00
assets
Net cash received from disposal of
subsidiaries and other units
Other cash received concerning
investing activities
Subtotal of cash in-flow arising from
50,000.00
investment activity
Cash paid for purchasing fixed,
5,272.56
intangible and other long-term assets
Cash paid for investment
Net cash received from subsidiaries
and other units obtained
Other cash paid concerning investing
activities
Subtotal of cash out-flow arising from
5,272.56
investment activity
Net cash flow arising from investment
50,000.00 -5,272.56
activities
III. Cash flows arising from financing
activities:
Cash received from absorbing
290,292,780.18
investment
Cash received from loans
Other cash received concerning
9,000,000.00
financing activities
Subtotal of cash in-flow arising from
299,292,780.18
financing activity
Cash paid for settling debts
Cash paid for dividend and profit
distributing or interest paying
Other cash paid concerning financing
19,085,278.53 1,074,521.05
activities
Subtotal of cash out-flow arising from
19,085,278.53 1,074,521.05
financing activity
Net cash flow arising from financing
280,207,501.65 -1,074,521.05
activities
IV. Influence on cash and cash
equivalents due to fluctuation in
exchange rate
V. Net increased amount of cash and cash
32,790,659.10 -2,483,980.99
equivalent
Add: Balance of cash and cash
7,613,043.60 10,097,024.59
equivalents at the period -begin
VI. Balance of cash and cash equivalents
40,403,702.70 7,613,043.60
at the period -end
7. Statement of Changes in Owners’ Equity (Consolidated)
Current amount
101
Unit: RMB/CNY
2022
Owners’ equity attributable to the parent Company
Other equity Othe
instrument Capi r Surp Prov Total
Less: Reas Min own
Item Shar tal com lus ision Retai ority
Inve onab er’ s
e publi preh publi of ned Othe Subt inter
Prefe Perp ntory le equit
capit Othe c ensiv c gene profi r otal ests
rred etual share reser y
al r reser e reser ral t
stock bond s ve
ve inco ve risk
s me
I.
The
endi
ng -
551, 627, 32,6 15,0 24,0
bala 1,20 8,91
347, 834, 73,2 84,1 02,7
nce 2,93 8,53
947. 297. 27.0 95.5 33.6
of 6,93 8.16
00 85 1 2 8
the 3.70
previ
ous
year
A
dd:
Chan
ges
of
acco
untin
g
polic
y
前
Error
corre
ction
of
the
last
perio
d
同
Ente
rpris
e
com
bine
unde
r the
same
contr
ol
Othe
102
r
II.
The
begi
nnin
-
g 551, 627, 32,6 15,0 24,0
1,20 8,91
bala 347, 834, 73,2 84,1 02,7
2,93 8,53
nce 947. 297. 27.0 95.5 33.6
6,93 8.16
of 00 85 1 2 8
3.70
the
curre
nt
year
III.
Incre
ase/
Decr
ease
in
the 137, 150, - 281, - 280,
perio 836, 990, 7,61 210, 365, 844,
d 986. 173. 6,37 780. 964. 815.
(Dec 00 10 8.75 35 47 88
rease
is
liste
d
with
“-”)
(i)
Total
com - - - -
preh 7,61 7,61 365, 7,98
ensiv 6,37 6,37 964. 2,34
e 8.75 8.75 47 3.22
inco
me
(ii)
Own
ers’
devo
137, 150, 288, 288,
ted
836, 990, 827, 827,
and
986. 173. 159. 159.
decr
00 10 10 10
ease
d
capit
al
1．
Com
mon 137, 150, 288, 288,
share 836, 990, 827, 827,
s 986. 173. 159. 159.
inves 00 10 10 10
ted
by
103
own
ers
2．
Capi
tal
inves
ted
by
hold
ers
of
other
equit
y
instr
ume
nts
3．
Amo
unt
reck
oned
into
own
ers
equit
y
with
share
-
base
d
pay
ment
4．
Othe
r
(iii)
Profi
t
distri
butio
n
1．
With
draw
al of
surpl
us
publi
c
reser
ve
2．
With
draw
104
al of
gene
ral
risk
provi
sions
3．
Distr
ibuti
on
for
own
ers
(or
share
hold
ers)
4．
Othe
r
(iv)C
arryi
ng
forw
ard
inter
nal
own
ers’
equit
y
1．T
ransf
er of
capit
al
reser
ves
to
capit
al (or
share
capit
al)
2．T
ransf
er of
surpl
us
publi
c
reser
ves
to
capit
al (or
105
share
capit
al)
3．
Rem
edyi
ng
loss
with
surpl
us
publi
c
reser
ve
4．
Carr
y-
over
retai
ned
earni
ngs
from
the
defin
ed
bene
fit
plans
5．
Carr
y-
over
retai
ned
earni
ngs
from
other
com
preh
ensiv
e
inco
me
6．
Othe
r
(v)R
easo
nabl
e
reser
ve
1．
106
With
draw
al in
the
curre
nt
perio
d
2．
Usag
e in
the
curre
nt
perio
d
(vi)
Othe
r
IV.
Bala
nce
-
at 689, 778, 32,6 290, 14,7 304,
1,21
the 184, 824, 73,2 129, 18,2 847,
0,55
end 933. 470. 27.0 318. 31.0 549.
3,31
of 00 95 1 51 5 56
2.45
the
perio
d
Amount of the previous period
Unit: RMB/CNY
2021
Owners’ equity attributable to the parent Company
Other equity Othe
instrument Capi r Surp Prov Total
Less: Reas Min
Item Shar tal com lus ision Retai own
Inve onab ority
e publi preh publi of ned Othe Subt er’ s
Prefe Perp ntory le inter
capit Othe c ensiv c gene profi r otal equit
rred etual share reser ests
al r reser e reser ral t y
stock bond s ve
ve inco ve risk
s me
I.
The
endi
ng -
551, 627, 32,6 10,9 14,7 25,6
bala 1,20
347, 834, 73,2 05,2 37,0 42,2
nce 0,95
947. 297. 27.0 30.9 58.7 89.6
of 0,24
00 85 1 8 0 8
the 0.88
previ
ous
year
A
dd:
107
Chan
ges
of
acco
untin
g
polic
y
前
Error
corre
ction
of
the
last
perio
d
同
Ente
rpris
e
com
bine
unde
r the
same
contr
ol
其
Othe
r
II.
The
begi
nnin
-
g 551, 627, 32,6 10,9 14,7 25,6
1,20
bala 347, 834, 73,2 05,2 37,0 42,2
0,95
nce 947. 297. 27.0 30.9 58.7 89.6
0,24
of 00 85 1 8 0 8
0.88
the
curre
nt
year
III.
Incre
ase/
Decr
ease
- - -
in 347,
1,98 1,98 1,63
the 136.
6,69 6,69 9,55
perio 82
2.82 2.82 6.00
d
(Dec
rease
is
liste
108
d
with
“-”)
(i)
Total
com - - -
347,
preh 1,98 1,98 1,63
136.
ensiv 6,69 6,69 9,55
82
e 2.82 2.82 6.00
inco
me
(ii)
Own
ers’
devo
ted
and
decr
ease
d
capit
al
1．
Com
mon
share
s
inves
ted
by
own
ers
2．
Capi
tal
inves
ted
by
hold
ers
of
other
equit
y
instr
ume
nts
3．
Amo
unt
reck
oned
into
own
ers
equit
109
y
with
share
-
base
d
pay
ment
4．
Othe
r
(iii)
Profi
t
distri
butio
n
1．
With
draw
al of
surpl
us
publi
c
reser
ve
2．
With
draw
al of
gene
ral
risk
provi
sions
3．
Distr
ibuti
on
for
own
ers
(or
share
hold
ers)
4．
Othe
r
(iv)C
arryi
ng
forw
ard
110
inter
nal
own
ers’
equit
y
1．T
ransf
er of
capit
al
reser
ves
to
capit
al (or
share
capit
al)
2．T
ransf
er of
surpl
us
publi
c
reser
ves
to
capit
al (or
share
capit
al)
3．
Rem
edyi
ng
loss
with
surpl
us
publi
c
reser
ve
4．
Carr
y-
over
retai
ned
earni
ngs
from
the
111
defin
ed
bene
fit
plans
5．
Carr
y-
over
retai
ned
earni
ngs
from
other
com
preh
ensiv
e
inco
me
6．
Othe
r
(v)R
easo
nabl
e
reser
ve
1．
With
draw
al in
the
curre
nt
perio
d
2．
Usag
e in
the
curre
nt
perio
d
(vi)
Othe
r
IV. -
551, 627, 32,6 15,0 24,0
Bala 1,20 8,91
347, 834, 73,2 84,1 02,7
nce 2,93 8,53
947. 297. 27.0 95.5 33.6
at 6,93 8.16
00 85 1 2 8
the 3.70
112
end
of
the
perio
d
8. Statement of Changes in Owners’ Equity (Parent Company)
Current amount
Unit: RMB/CNY
2022
Other equity instrument Other
Less: compr Surplu Total
Item Capital Reaso Retain
Share Preferr Invent ehensi s owner’
Perpet public nable ed Other
capital ed Other ory ve public s
ual reserve reserve profit
stock shares incom reserve equity
bonds e
I. The
ending
-
balanc 551,34 627,83 32,673
1,209, 2,847,
e of 7,947. 4,297. ,227.0
007,57 892.08
the 00 85 1
9.78
previo
us year
A
dd:
Chang
es of
accoun
ting
policy
前
Error
correct
ion of
the last
period
其
Other
II. The
beginn
ing -
551,34 627,83 32,673
balanc 1,209, 2,847,
7,947. 4,297. ,227.0
e of 007,57 892.08
00 85 1
the 9.78
current
year
III.
Increas
137,83 150,99 - 282,45
e/
6,986. 0,173. 6,374, 3,023.
Decrea
00 10 136.01 09
se in
the
113
period
(Decre
ase is
listed
with “-
”)
(i)
Total
compr - -
ehensi 6,374, 6,374,
ve 136.01 136.01
incom
e
(ii)
Owner
s’
137,83 150,99 288,82
devote
6,986. 0,173. 7,159.
d and
00 10 10
decrea
sed
capital
1．Co
mmon
137,83 150,99 288,82
shares
6,986. 0,173. 7,159.
investe
00 10 10
d by
owners
2．Ca
pital
investe
d by
holder
s of
other
equity
instru
ments
3． A
mount
reckon
ed into
owners
equity
with
share-
based
payme
nt
4．Ot
her
(iii)
Profit
distrib
ution
1．Wi
114
thdraw
al of
surplus
public
reserve
2．Dis
tributi
on for
owners
(or
shareh
olders)
3．Ot
her
(iv)Car
rying
forwar
d
interna
l
owners
’
equity
1．Tra
nsfer
of
capital
reserve
s to
capital
(or
share
capital
)
2．Tra
nsfer
of
surplus
public
reserve
s to
capital
(or
share
capital
)
3．Re
medyi
ng loss
with
surplus
public
reserve
4．Ca
rry-
115
over
retaine
d
earnin
gs
from
the
define
d
benefit
plans
5．Ca
rry-
over
retaine
d
earnin
gs
from
other
compr
ehensi
ve
incom
e
6．Ot
her
(v)Rea
sonabl
e
reserve
1．Wi
thdraw
al in
the
current
period
2．Us
age in
the
current
period
(vi)
Other
IV.
Balanc -
689,18 778,82 32,673 285,30
e at the 1,215,
4,933. 4,470. ,227.0 0,915.
end of 381,71
00 95 1 17
the 5.79
period
Amount of the previous period
Unit: RMB/CNY
Item 2021
116
Other equity instrument Other
Less: compr Surplu Total
Capital Reaso Retain
Share Preferr Invent ehensi s owner’
Perpet public nable ed Other
capital ed Other ory ve public s
ual reserve reserve profit
stock shares incom reserve equity
bonds e
I. The
ending
-
balanc 551,34 627,83 32,673
1,206, 5,264,
e of 7,947. 4,297. ,227.0
590,54 924.28
the 00 85 1
7.58
previo
us year
A
dd:
Chang
es of
accoun
ting
policy
前
Error
correct
ion of
the last
period
其
Other
II. The
beginn
ing -
551,34 627,83 32,673
balanc 1,206, 5,264,
7,947. 4,297. ,227.0
e of 590,54 924.28
00 85 1
the 7.58
current
year
III.
Increas
e/
Decrea
se in
- -
the
2,417, 2,417,
period
032.20 032.20
(Decre
ase is
listed
with “-
”)
(i)
Total
compr - -
ehensi 2,417, 2,417,
ve 032.20 032.20
incom
e
117
(ii)
Owner
s’
devote
d and
decrea
sed
capital
1．Co
mmon
shares
investe
d by
owners
2．Ca
pital
investe
d by
holder
s of
other
equity
instru
ments
3． A
mount
reckon
ed into
owners
equity
with
share-
based
payme
nt
4．Ot
her
(iii)
Profit
distrib
ution
1．Wi
thdraw
al of
surplus
public
reserve
2．Dis
tributi
on for
owners
(or
shareh
olders)
3．Ot
118
her
(iv)Car
rying
forwar
d
interna
l
owners
’
equity
1．Tra
nsfer
of
capital
reserve
s to
capital
(or
share
capital
)
2．Tra
nsfer
of
surplus
public
reserve
s to
capital
(or
share
capital
)
3．Re
medyi
ng loss
with
surplus
public
reserve
4．Ca
rry-
over
retaine
d
earnin
gs
from
the
define
d
benefit
plans
5．Ca
rry-
over
119
retaine
d
earnin
gs
from
other
compr
ehensi
ve
incom
e
6．Ot
her
(v)Rea
sonabl
e
reserve
1．Wi
thdraw
al in
the
current
period
2．Us
age in
the
current
period
(vi)
Other
IV.
Balanc -
551,34 627,83 32,673
e at the 1,209, 2,847,
7,947. 4,297. ,227.0
end of 007,57 892.08
00 85 1
the 9.78
period
III. Company Profile
1. History and basic information
According to the Approval Document SFBF (1991) No. 888 issued by the People’s Government of Shenzhen,
Shenzhen China Bicycle Company (Holdings) Limited (hereinafter referred to as the CBC) was reincorporated as
the company limited by shares in November 1991. On 28 December 1991, upon the Approval Document
SRYFZ(1991) No. 119 issued by Shenzhen Special Economic Zone Branch of the People’s Bank of China, the
Company got listed on Shenzhen Stock Exchange. Registered of the Company amounted as 689,184,933.00 Yuan.
Legal representative: Li Hai
Location: No. 3008, Buxin Road, Luohu District, Shenzhen
120
Certificate for Uniform Social Credit Code:914403006188304524。
2. Business nature and main operation activities
Main business activities: Research & development of the bicycles, electric bicycles, electric motorcycles,
motorcycles, electric tricycles, electric four-wheeler, children's bicycles, exercise bikes, sports equipment,
mechanical products, toys, electric toys, electronic products, new energy equipment and storage equipment
(lithium batteries, batteries, etc.), household appliances and spare parts, and electronic components; wholesale,
retail, import and export and related supporting business of above-mentioned products (excluding commodities
subject to state trade management, handling the application according to the relevant national regulations for
commodities involving quotas, license management and other special provisions and management,); fine chemical
products (excluding dangerous goods), wholesale and retail of carbon fiber composite materials; technology
development of computer software, transfer of self-developed technological achievements, and providing relevant
technical information consultation; own property leasing; property management. (The above projects do not
involve special administrative measures for the implementation access of national regulations, and those involving
restricted projects and pre-existing administrative licenses must obtain the pre-existing administrative licensing
documents before operation.) Purchase and sale of gold products, platinum jewelry, palladium jewelry, K-gold
jewelry, silver jewelry, inlaid jewelry, jewelry, jade ware, gem-and-jade products, clocks and watches, precious
metal materials, diamonds, jadeite, crafts (except ivory and its products), calligraphy and painting, collection
(except for antiques, cultural relics, and items prohibited by national laws and administrative regulations).
Main products or services currently offered are: EMMELLE bicycles, electrical bicycles, lithium battery material
and gold jewelry.
3.Actual controller of the Company
Actual controller of the Company is Wang Shenghong, who held or controlled 20% shares of the Company.
4. Release of the financial report
The Financial Report was approved to report at the 3rd Session of 11th BOD of CBC on April 21, 2023.
5.Scope of the consolidate statement
The CBC has two subsidiaries and one sub-subsdiary included in the scope of consolidated financial statement,
refer to the Note VIII-1.
121
IV. Compilation Basis of Financial Statement
1. Compilation Basis
The financial statement is prepared based on continuing operation assumptions, and according to actual
occurrence, in line with relevant accounting rules and follow important accounting policy and estimation.
2. Going concern
During the 12 months since end of the reporting period, there are no factors that cast significant doubt on the
sustainability and other matters that have affected the Company.
V. Main accounting policy and Accounting Estimate
Tips for specific accounting policy and estimate:
1. Declaration on compliance with accounting standards for business enterprise
The financial statement prepared by the CBC Company, based on follow compilation basis, is comply with the
requirement of new accounting standards for business enterprise issued by Ministry of Finance and its application
guide, commentate as well as other regulations (collectively referred to as Accounting Standards for Business
Enterprise), which is reflect a real and truth financial status of the Company, as well as operation results and cash
flow situations.
Furthermore, the statement has reference to the listing and disclosure requirement from “Rules Governing the
Disclosure of Information for Enterprise with Stock Listed No.15-general regulation of financial report” (2014
Revised) and “Notice on Implementation of New Accounting Standards for Listed Companies” (KJBH (2018) No.
453)
2. Accounting period
Calendar year is the accounting period for the CBC, which is starting from 1 January to 31 December.
3. Business cycles
The business period for the Company, which is the Gregorian calendar starting from 1 January to 31 December
122
4. Book-keeping currency
The CBC takes RMB as the standard currency for bookkeeping.
5. Accounting treatment for business combinations under the same control and those not under the same
control
(1) Accounting treatment for business combinations under the same control and those not under the same control
For a business merger that is under the same control and is achieved by the CBC through one single transaction or
multiple transactions, assets and liabilities obtained from that business combination shall be measured at their
book value at the combination date as recorded by the party being absorbed in the consolidated financial statement
of ultimate controlling party. Capital reserve shall be adjusted as per the difference between the book value of
obtained net assets and the book value of paid consolidated consideration (or the nominal value of the issued
shares) of the Company; retained earnings shall be adjusted if the capital reserve is not sufficient for offset.
(2) Accounting treatment for Enterprise combine not under the same control
The CBC will validate the difference that the combined cost is more than the fair value of the net identifiable
assets gained from the acquiree on the acquisition date as goodwill; where the combined cost is less than the fair
value of net identifiable assets gained from the acquiree during business combination, the fair value and combined
cost of various identifiable assets, liabilities and contingent liabilities from the acquiree must be rechecked. Where
the combined cost is, after the recheck, still less than the fair value of net identifiable assets gained from the
acquiree during business combination, the difference shall be charged to current profits and losses.
As for business combination not under common control and realized through multiple transactions and by steps,
the CBC shall make accounting treatment as follows:
1) Adjust the initial investment cost of long-term equity investments. As for stock equities held before the
acquisition date accounted according to the equity method, re-measurement is carried out according to the fair
value of the equity on the acquisition date. The balance between the fair value and the book value is included in
the current investment income. If the acquiree’s stock equities held before the acquisition date involves changes of
other comprehensive incomes and other owner's equities under accounting with the equity method, the balance
between the fair value and the book value is included in the current investment income on the acquisition date,
excluding other comprehensive incomes incurred by changes due to re-measurement of net liabilities or net assets
of the defined benefit plan.
2) Confirm the goodwill (or include the amount in the profits and losses). The initial investment cost of long-term
equity investments adjusted in step 1 is compared with the fair value of net identifiable assets of the subsidiary
shared on the acquisition date. If the former is greater than the latter, the balance is confirmed as goodwill; if the
former is less than the latter, the balance is included in the current profits and losses.
Loss of control of a subsidiary in multiple transactions in which it disposes equity interests of its subsidiary in
123
stages
(1)In determining whether to account for the multiple transactions as a single transaction
A parent shall consider all the terms and conditions of the transactions and their economic effects. One or more of
the following may indicate that the parent should account for the multiple arrangements as a single transaction:
1) Arrangements are entered into at the same time or in contemplation of each other;
2) Arrangements work together to achieve an overall commercial effect;
3) The occurrence of one arrangement is dependent on the occurrence of at least one other arrangement;
4)One arrangement considered on its own is not economically justified, but it is economically justified when
considered together with other arrangements.
(2)Accounting treatment for each of the multiple transactions forming part of a bundled transactions which
eventually results in loss of control the subsidiary during disposal of its subsidiary in stages
If each of the multiple transactions forms part of a bundled transactions which eventually results in loss of control
the subsidiary, these multiple transactions should be accounted for as a single transaction. In the consolidated
financial statements, the difference between the consideration received and the corresponding percentage of the
subsidiary’s net assets in each transaction prior to the loss of control shall be recognized in other comprehensive
income and transferred to the profit or loss when the parent eventually loses control of the subsidiary.
The remaining equity investment shall be re-measured at its fair value in the consolidated financial statements at
the date when control is lost. The difference between the total amount of consideration received from the
transaction that resulted in the loss of control and the fair value of the remaining equity investment and the share
of net assets of the former subsidiary calculated continuously from the acquisition date or combination date based
on the previous shareholding proportion, shall be recognized as investment income for the current period when
control is lost. The amount previously recognized in other comprehensive income in relation to the former
subsidiary’s equity investment should be transferred to investment income for the current period when control is
lost
(3)Accounting treatment for each of the multiple transactions NOT forming part of a bundled transactions which
eventually results in loss of control the subsidiary during disposal of its subsidiary in stages
If the Company doesn't lose control of investee, the difference between the amount of the consideration received
and the corresponding portion of net assets of the subsidiary shall be adjusted to the capital reserve (capital /equity
premium) in the consolidated financial statements.
If the Company loses control of investee, the remaining equity investment shall be re-measured at its fair value in
the consolidated financial statements at the date when control is lost. The difference between the total amount of
consideration received from the transaction that resulted in the loss of control and the fair value of the remaining
equity investment and the share of net assets of the former subsidiary calculated continuously from the acquisition
date or combination date based on the previous shareholding percentage, shall be recognized as investment
124
income for the current period when control is lost. The amount previously recognized in other comprehensive
income in relation to the former subsidiary’s equity investment should be transferred to investment income for the
current period when control is lost.
6. Compilation method of consolidated financial statement
Consolidated financial statements are prepared by the Company in accordance with Accounting Standard for
Business Enterprise No. 33-Consolidated Financial Statements and based on financial statements of parent
company and its subsidiaries and other related information.
When consolidating the financial statements, the following items are eliminated: internal equity investment and
owners’ equity of subsidiaries, proceeds on internal investments and profit distribution of subsidiaries, internal
transactions, internal debts and claim. The accounting policies adopted by subsidiaries are the same as parent
company.
7. Classification of joint venture arrangement and accounting treatment for joint control
(1) Recognition and classification of joint venture arrangement
Joint arrangement refers to an arrangement controlled by two or more than two participants. Joint venture
arrangement has the following characteristics: 1) Each participant is bound by the arrangement; 2) Two or more
participants carry out joint control on implementation of the arrangement. Any participant cannot control the
arrangement independently. Any participant for joint control can stop other participants or participant
combinations to independently control the arrangement.
Joint control refers to the sharing of control over certain arrangement under related agreements, and related
activities of the arrangement must be determined only when obtaining the unanimous consent of the parties
sharing control.
Joint venture arrangement is classified in to joint operation and joint venture. Joint operation refers to an
arrangement that a joint party enjoys assets related to the arrangement and bears liabilities related to the
arrangement. Joint venture refers to an arrangement that a joint party only has the power governing net assets of
the arrangement.
(2) Accounting treatment of joint venture arrangement
Joint venture participants should confirm the following items related to interest shares in joint venture and carry
out accounting settlement according to relevant provisions of the Accounting Standards for Business Enterprises:
1) confirm the assets held separately and confirm the assets held jointly based on shares; 2) confirm the liabilities
borne separately and confirm the liabilities borne jointly based on shares; 3) confirm the income incurred after
selling its shares in joint venture output; 4) confirm the income after selling the joint venture outputs based on
shares; 5) confirm the expenses incurred separately and confirm the expenses incurred in joint venture based on
125
shares.
Joint venture participants should carry out accounting settlement for investments of the joint venture according to
provisions of Accounting Standards for Business Enterprises No.2–Long-term Equity Investments.
8. Recognition of cash and cash equivalents
Cash in cash flow statement means the inventory cash and savings available for use anytime. Cash equivalents
refer to the short-term (generally due within three months since the date of purchase) highly liquid investments
that are readily convertible into known amounts of cash and that are subject to an insignificant risk of change in
value.
9. Foreign currency transaction and financial statement conversion
(1)Conversion for foreign currency transaction
When initially recognized, the foreign currency for the transaction shall be converted into CNY amount according
to the spot exchange rate on the date of transaction. For the foreign currency monetary items, conversion must be
based on the spot exchange rate on the balance sheet date and the exchange difference incurred from different
exchange rates, except for the exchange difference of principal and interest incurred due to foreign currency loan
related to acquisition or construction of assets that qualify for capitalization, shall be charged to current profits and
losses; foreign currency non-monetary items measured with historical cost are still converted as per the spot
exchange rate on the transaction date and keep the RMB amount unchanged; foreign currency non-monetary items
measured with fair value shall be converted as per the spot exchange rate on the date of determining the fair value
and the difference shall be charged to current profits and losses or other comprehensive income.
(2)Conversion of financial statements presented in foreign currencies
The asset and liability items in the balance sheet shall be converted at the spot exchange rate on the balance sheet
date; the owner’s equity items, except for the items of “Retained profit”, shall be converted at the spot exchange
rate on the transaction date; the income and expenditure items in the profit statement shall be converted at the spot
exchange rate on the transaction date. The translation difference of foreign financial statements conducted as
above is recognized as other comprehensive incomes.
10. Financial instruments
(1) Recognition and termination for financial instrument
Financial assets or financial liabilities are recognized when the CBC becomes a party to the contractual provisions
of the instrument.
126
When buying and selling financial assets in a conventional manner, recognize and derecognize them according to
the accounting of the trading day. Buying and selling financial assets in a conventional manner refers to the
collection or delivery of financial assets in accordance with the contract terms and within the period prescribed by
regulations or prevailing practices. Trading day refers to the date when the CBC promises to buy or sell financial
assets.
When meeting the following conditions, a financial asset (or part of a financial asset, or part of a group of similar
financial assets) need terminate recognition, i.e. to write off from its account and balance sheet:
1) The right to receive cash flows from financial assets expires;
2) The right to receive cash flows of financial assets is transferred, or assume the obligation to pay the full amount
of cash flows received to a third party in a timely manner under the “handover agreement”; and (a) virtually
transferred almost all risks and rewards of the ownership of financial assets, or (b) although virtually neither
transferred nor retained almost all risks and rewards of the ownership of financial assets, abandoned the control of
the financial assets.
(2) Classification and measurement of financial assetsThe CBC’s financial assets are classified as financial assets
measured at amortized cost, financial assets measured at fair value and whose changes are included in other
comprehensive income, and financial assets measured at fair value and whose changes are included in the current
profit and loss according to the CBC’s business model for managing financial assets and the contractual cash flow
characteristics of financial assets at initial recognition. The subsequent measurement of financial assets depends
on their classification.
The CBC’s classification of financial assets is based on CBC’s business model for managing financial assets and
the cash flow characteristics of financial assets.
1) Financial assets measured at amortized costFinancial assets that meet the following conditions at the same time
are classified as financial assets measured at amortized cost: the Company’s business model for managing this
financial asset is to collect contractual cash flows; the contract terms of the financial asset stipulate that the cash
flow generated on a specific date is only the payment of principal and interest based on the outstanding principal
amount. For such financial assets, the actual interest rate method is used for subsequent measurement based on
amortized cost, and the gains or losses arising from amortization or impairment are included in the current profit
and loss.
127
2) Debt instrument investments measured at fair value and whose changes are included in other comprehensive
income
Financial assets that meet the following conditions at the same time are classified as financial assets measured at
fair value and whose changes are included in other comprehensive income: the Company’s business model for
managing this financial asset is to both collect contractual cash flows and sell the financial assets; the contract
terms of the financial asset stipulate that the cash flow generated on a specific date is only for the payment of
principal and interest based on the outstanding principal amount. For such financial assets, fair value is used for
subsequent measurement. The discount or premium is amortized by using the actual interest method and is
recognized as interest income or expenses. Except that the impairment loss and the exchange difference of foreign
currency monetary financial assets are recognized as current gains and losses, changes in the fair value of such
financial assets are recognized as other comprehensive income, until the financial asset is derecognized, its
cumulative gains or losses are transferred to the current profit and loss. Interest income related to such financial
assets is included in the current profit and loss.
3) Equity instrument investments measured at fair value and whose changes are included in other comprehensive
income
The CBC irrevocably chooses to designate some non-trading equity instrument investments as financial assets
measured at fair value and whose changes are included in other comprehensive income. Only relevant dividend
income is included in the current profit and loss, and changes in fair value are recognized as other comprehensive
income, until the financial asset is terminate recognition, its accumulated gains or losses are transferred to retained
earnings.
4) Financial assets measured at fair value and whose changes are included in the current profit and loss
Financial assets except for above financial assets measured at amortized cost and financial assets measured at fair
value and whose changes are included in other comprehensive income are classified as financial assets measured
at fair value and whose changes are included in the current profit and loss. During initial recognition, in order to
eliminate or significantly reduce accounting mismatches, financial assets can be designated as financial assets
measured at fair value and whose changes included in the current profit and loss. For such financial assets, fair
value is used for subsequent measurement, and all changes in fair value are included in the current profit and loss.
When and only when the Company changes its business model for managing financial assets, it will reclassify all
affected related financial assets. For financial assets measured at fair value and whose changes are included in the
128
current profit or loss, the related transaction costs are directly included in the current profit and loss, and the
related transaction costs of other types of financial assets are included in the initial recognition amount.
(3) Classification and measurement of financial liabilitiesThe CBC’s financial liabilities are classified as financial
liabilities measured at amortized cost and financial liabilities measured at fair value and whose changes are
included in the current profit and loss at initial recognition.
Financial liabilities that meet one of the following conditions can be designated as financial liabilities measured at
fair value and whose changes are included in current profit or loss during initial measurement: (1) This
designation can eliminate or significantly reduce accounting mismatches; (2) According to the group risk
management or investment strategies stated in official written documents, management and performance
evaluation of financial liability portfolios or financial assets and financial liability portfolios are conducted based
on fair value, and are reported to key management personnel within the group on this basis; (3) The financial
liability includes embedded derivatives that need to be split separately.
The CBC determines the classification of financial liabilities at initial recognition. For financial liabilities that are
measured at fair value and whose changes are included in the current profit or loss, the related transaction costs
are directly included in the current profit and loss, and the related transaction costs of other financial liabilities are
included in its initial recognition amount.
The subsequent measurement of financial liabilities depends on their classification:
1) Financial liabilities measured at amortized costFor such financial liabilities, adopt actual interest rate method
and make subsequent measurements based on amortized costs.
2) Financial liabilities measured at fair value and whose changes are included in the current profit and
lossFinancial liabilities that are measured at fair value and whose changes are included in the current profit or loss
include trading financial liabilities (including derivatives that are financial liabilities) and financial liabilities
designated to be measured at fair value at the initial recognition and whose changes are included in the current
profit or loss.
(4) Financial instruments offsetIf the following conditions are met at the same time, the financial assets and
financial liabilities are listed in the balance sheet with the net amount after mutual offset: legal right to offset the
confirmed amount, and this legal right is currently executable; Net settlement, or simultaneous realization of the
financial assets and liquidation of the financial liabilities.
129
(5) Impairment of financial assetsThe CBC recognizes the loss provisions on the basis of expected credit losses
for financial assets measured at amortized cost, debt instrument investments measured at fair value and whose
changes are included in other comprehensive income and financial guarantee contracts. Credit loss refers to the
difference between all contractual cash flows receivable under the contract and discounted according to original
actual interest rate by the CBC and all expected receivable cash flows, that is, the present value of all cash
shortages.
The CBC considers all reasonable and evidence-based information, including forward-looking information, and
estimates the expected credit loss of financial assets measured at amortized cost and financial assets measured at
fair value and whose changes are included in other comprehensive income (debt instruments) in a single or
combined manner.
1) General model of expected credit lossIf the credit risk of the financial instrument has increased significantly
since the initial recognition, the CBC measures its loss provisions in accordance with the amount equivalent to the
expected credit loss of the financial instrument for the entire duration; if the credit risk of the financial instrument
has not significantly increased since the initial recognition, the CBC measures its loss provisions in accordance
with the amount equivalent to the expected credit loss of the financial instrument in the next 12 months. The
resulting increased or reversed amount of the loss provisions is included in the current profit and loss as an
impairment loss or gain. For the CBC’s specific assessment of credit risk, please see details in Note IX. Risks
Related to Financial Instruments”.
Generally, the CBC believes that the credit risk of the financial instrument has significantly increased when it
exceeds 30 days after the due date, unless there is concrete evidence that the credit risk of the financial instrument
has not increased significantly since initial recognition.
Specifically, the Company divides the process of credit impairment of financial instruments of which no credit
impairment has occurred at the time of purchase or origin into three stages. There are different accounting
treatment methods for the impairment of financial instruments at different stages:
Stage one: Credit risk has not increased significantly since initial recognition
For a financial instrument at this stage, the enterprise should measure the loss provisions according to the
expected credit losses in the next 12 months, and calculate the interest income based on its book balance (that is,
without deducting provisions for impairment) and the actual interest rate (if the instrument is a financial asset, the
130
same below).
Stage two: Credit risk has increased significantly since initial recognition but no credit impairment has occurred
For a financial instrument at this stage, the enterprise should measure the loss provisions according to the
expected credit loss of the instrument for its entire duration, and calculate the interest income based on its book
balance and actual interest rate.
Stage three: Credit impairment occurs after initial recognition
For a financial instrument at this stage, the enterprise should measure the loss provisions based on the expected
credit losses of the instrument for its entire duration, but the calculation of interest income is different from the
financial assets at the previous two stages. For financial assets that have suffered credit impairment, the enterprise
should calculate interest income based on its amortized cost (book balance minus the provisions for impairment,
i.e., book value) and the actual interest rate.
For financial assets that have suffered credit impairment at the time of purchase or origin, the enterprise should
only recognize changes in expected credit losses for the entire duration after initial recognition as loss provisions,
and calculate the interest income based on its amortized cost and credit-adjusted actual interest rate.
2) The CBC chooses not to compare the financial instrument with lower credit risk on the balance sheet date with
its credit risk at initial recognition, but directly makes the assumption that the credit risk of the instrument has not
increased significantly since the initial recognition.
If the enterprise confirms that the default risk of financial instruments is low, the borrower has a strong ability to
fulfill its contractual cash flow obligations in the short term, and even if there are adverse changes in the economic
situation and operating environment in a longer period of time, it will not necessarily reduce the borrower’s ability
to fulfill its contractual cash flow obligations, then the financial instrument can be considered to have lower credit
risk.
3) Accounts receivable and lease receivablesThe CBC adopts the simplified model of expected credit loss for
accounts receivables specified in “Accounting Standards for Business Enterprises No.14 - Revenue” and without
containing significant financing components (including the case that the financing components in contracts that do
not exceed one year are not considered according to the standards), that is, always measures their loss provisions
according to the amount of expected credit loss during the entire duration.
131
The CBC makes accounting policy choices for the receivables containing significant financing components and
the lease receivables specified in “Accounting Standards for Business Enterprises No.21 - Leases”, and chooses to
adopt the simplified model of expected credit losses, that is, to measure the loss provisions in accordance with the
amount of expected credit losses throughout the entire duration.
(6) Transfer of financial assets
Where the CBC has transferred almost all the risks and rewards in the ownership of the financial asset to the
transferee, the recognition of the financial assets shall be terminated; where almost all risks and rewards in the
ownership of a financial asset are retained, the recognition of the financial assets are not terminated.
If the CBC neither transfers nor retains substantially all the risks and rewards of ownership of a financial asset, it
shall be accounted for as follows: the financial asset should be terminated if the Group waives control over the
asset; it recognizes the financial asset to the extent of its continuing involvement in the transferred financial asset
and recognizes an associated liability if the Group does not waives control over the asset.
If the transferred financial assets continue to be involved by providing financial guarantee, the assets continue to
be involved shall be recognized according to the lower of the book value of the financial assets and the amount of
financial guarantee. The financial guarantee amount means the maximum amount of consideration received which
will be required to be repaid.
The Company shall comply with the disclosure requirement of jewelry-related industries in the “Shenzhen Stock Exchange Self-
Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”
11. Note receivable
The Group adopts the simplified model of expected credit loss for the accounts receivables specified in
“Accounting Standards for Business Enterprises No.14 - Revenue” and without containing significant financing
components (including the case that the financing components in contracts that do not exceed one year are not
considered according to the standards), that is, always measures their loss provisions according to the amount of
expected credit loss during the entire duration, and the resulting increased or reversed amount of the loss provision
is included in the current profit and loss as an impairment loss or gain. The accrual method is as follows:
The CBC divides the note receivable into two types, i.e. bank acceptance notes and commercial acceptance notes
portfolios, according to the type of financial instruments. For bank acceptance note, the accepting bank pays the
determined amount to the taker or the bearer unconditionally due to the maturity of the bills, the overdue credit
loss is low and has not increased significantly since the initial confirmation, the CBC believes that the risk of
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overdue default is 0; for commercial acceptance bills, the CBC believes that the probability of default is related to
the aging, we use a simplified model of expected credit losses, that is the allowance for losses is always measured
at the amount of expected credit losses over the entire duration period. Proportion for accrual found more in the 12.
accounting policy and estimate for account receivable in III.
12. Account receivable
The CBC adopts the simplified model of expected credit loss for accounts receivables specified in “Accounting
Standards for Business Enterprises No.14 - Revenue” and without containing significant financing components
(including the case that the financing components in contracts that do not exceed one year are not considered
according to the standards), that is, always measures their loss provisions according to the amount of expected
credit loss during the entire duration, and the resulting increased or reversed amount of the loss provision is
included in the current profit and loss as an impairment loss or gain.
For accounts receivable that contain a significant financing component, the CBC chooses to use the simplified
model of expected credit losses, that is, to always measure its loss provisions according to the amount of expected
credit losses during the entire duration.
1. Simplified model of expected credit losses: always measure the loss provisions according to the amount of
expected credit losses during the entire duration
The CBC considers all reasonable and well-founded information, including estimates of expected credit losses
on accounts receivable in a single or combined manner.
(1)Account receivable with single significant amount and with individual provision for bad debt reserves
Judgment basis or amount criteria for account with Withdrawal method for bad debt provision of
single significant amount account receivable with single significant amount
Receivable commercial acceptance bill, account receivable Carry out impairment test separately, and withdraw bad
and other receivables with single amount more than 5 debt provision according to the difference between the
million yuan (including) present value of future cash flow and its book value
(2)Receivables with provision for bad debts by portfolio
Portfolio determine basis
On the basis of the actual loss rate of the portfolio of
receivables with similar credit risk characteristics which
are the same or similar in the previous year, for the
Age analysis single amount of non-material receivables, it is divided
into several portfolios according to the credit risk
characteristics together with the receivables without
impairment after the separate test
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Bank acceptance
Other
In the combination, the proportion of bad debt provision withdrawn by aging analysis method is as follow:
Accrual proportion of Withdrawing Withdrawing
Account age commercial acceptance bill proportion of the proportion of other
receivable account receivable receivable
Within one year(one year
included) 0.3% 0.3% 0.3%
1～2 years (2-year included) 100% 0.3% 0.3%
2～3 years (3-year included) 100% 0.3% 0.3%
Over 3 years 100% 100% 100%
Including: Irrecoverable
recognized Write off Write off Write off
(3)Account receivable with single significant amount and with individual provision for bad debt reserves
Judgment basis or amount criteria for account with Withdrawal method for bad debt provision of
single minor amount account receivable with single minor amount
Receivable commercial acceptance bill, account receivable Carry out impairment test separately, and withdraw bad
and other receivables with single amount less than 5 debt provision according to the difference between the
million yuan (including), and the probability of recall is present value of future cash flow and its book value
small by nature
2. A general model of expected credit loss
Found more in the treatment in【Note 10. Financial instrument】
13. Receivable financing
Financial assets that meet the following conditions at the same time are classified as financial assets measured at
fair value and whose changes are included in other comprehensive income: the CBC’s business model for
managing this financial asset is to both collect contractual cash flows and sell the financial assets; the contract
terms of the financial asset stipulate that the cash flow generated on a specific date is only for the payment of
principal and interest based on the outstanding principal amount.
The CBC transfers the receivables held by discounting or endorsement, and such operations are more frequent
with large amount involved. The management business models is essentially both the collection of contractual
cash flows and the sales; in accordance with the relevant provision of financial instrument standards, classified
them into the financial assets measured at fair value and with its variation reckoned into other comprehensive
income.
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14. Other account receivable
Determination method and accounting treatment of the expected credit loss of other account receivable
Determination method and accounting treatment of the expected credit loss of other account receivable
(1)Account receivable with single significant amount and with individual provision for bad debt reserves :
Account with single significant amount: the single receivable has over 5 million yuan at end of the period
At the end of the period, the receivables with significant single amount are tested separately for impairment. If
there is objective evidence that they have been impaired, the impairment loss will be recognized and the provision
for bad debts will be made based on the balance between the present value of future cash flows and its book value.
(2)Account receivable with bad debt provision accrual by portfolio
For the receivables with non significant single amount at the end of the period, they are divided into several
combinations together with the receivables without impairment after independent test according to the account age
as the credit risk feature. The impairment loss is calculated and determined according to a certain proportion of
the ending balance of these receivables combinations (impairment test can be conducted separately), and the bad
debt provision is withdrawn.
In addition to the receivables for which impairment provision has been separately made, the company determines
the following proportion of provision for bad debts based on the actual loss rate of the combination of receivables
with account age as credit risk characteristics in the previous year, which is the same or similar to the receivables,
in combination with the current situation:
15. Inventory
The Company shall comply with the disclosure requirement of jewelry-related industries in the “Shenzhen Stock Exchange Self-
Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”
(1) Classification of inventory
The CBC classifies the inventory into raw materials, goods in process, goods on hand, wrap page, low value
consumables, materials for consigned processing and goods sold, etc.
(2) Valuation of inventories
Inventories are initially measured at cost upon acquisition, which includes procurement costs, processing costs
and other costs. Cost of the inventory issued is carried forward on the basis of a combination of the weighted
average method and specific identification when inventories are issued.
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(3) Provision for inventory impairment
When a comprehensive count of inventories is done at the end of the period, provision for inventory impairment is
allocated or adjusted using the lower of the cost of inventory and the net realizable value. The net realizable value
of stock in inventory (including finished products, goods in stock and materials for sale) that can be sold directly
is determined using the estimated saleable price of such inventory deducted by the cost of sales and relevant
taxation over the course of ordinary production and operation. The net realizable value of material in inventory
that requires processing is determined using the estimated saleable price of the finished product deducted by the
cost to completion, estimated cost of sales and relevant taxation over the course of ordinary production and
operation. The net realizable value of inventory held for performance of sales contract or labor service contract is
determined based on the contractual price; in case the amount of inventory held exceeds the contractual amount,
the net realizable value of the excess portion of inventory is calculated using the normal saleable price.
Provision for impairment is made according to individual items of inventories at the end of the period; however,
for inventories with large quantity and low unit price, the provision is made by categories; inventories of products
that are produced and sold in the same region or with the same or similar purpose or usage and are difficult to be
measured separately are combined for provision for impairment.
If the factors causing a previous write-off of inventory value has disappeared, the amount written-off is reversed
and the amount provided for inventory impairment is reversed and recognized in profit or loss for the period.
(4)Inventory system
Perpetual inventory system is adopted.
16. Contractual assets
1. Method and standard for recognition of contractual assets
The CBC lists contractual assets or contractual liabilities in the balance sheet based on the relationship between
performance obligations and customer payments. The CBC's right to receive consideration for goods or services
transferred to the customer (And that right depends on factors other than the passage of time) is listed as
contractual assets. Contractual assets and contractual liabilities under the same contract are listed as a net
amount. The CBC's right to receive consideration from customers unconditionally (only depends on the passage
of time) is listed separately as a receivable.
2. Determination and accounting treatment of the expected credit loss for contractual assets
Determination and accounting treatment of the expected credit loss for contractual assets found more in Note “10.
Financial assets”
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17. Contractual cost
18. Assets held for sale
The CBC classifies such corporate components (or non-current assets) that meet the following criteria as held-for-
sale: (1) Disposable immediately under current conditions based on similar transactions for disposals of such
assets or practices for the disposal group; (2) Probable disposal; that is, a decision has been made on a plan for
disposal and an undertaking to purchase has been obtained (the undertaking to purchase means a binding purchase
agreement entered into by the Company and other parties, which contains transaction price, time and adequately
strict punishments for breach of contract provisions, which renders the possibility of material adjustment or
revocation of the agreement is extremely minor), and the disposal is expected to be completed within a year.
Besides, approval from relevant competent authorities or regulatory authorities has been obtained as required by
relevant rules.
The expected net residual value of asset held for sale is adjusted by the CBC to reflect its fair value less selling
expense, provided that the net amount shall not exceed the original carrying value of the asset. In case that the
original value is higher than the adjusted expected net residual value, the difference shall be recorded in profit or
loss for the period as asset impairment loss, and allowance of impairment for the asset shall be provided.
Impairment loss recognized in respect of the disposal group held for sale shall be used to offset the carrying value
of the goodwill in the disposal group, and then offset the carrying value of the non-current assets within the
disposal group based on their respective proportion of their carrying value.
In respect of the non-current assets held for sale, if the net amount after their fair value less the selling expenses
increased as at the subsequent balance date, the reduced amount before will be recovered and reversed in the
assets impairment loss amount recognized after being classified as held for sale, and the reversed amount will be
recorded in the current profits or loss. The impairment loss on assets recognized before being classified as held for
sale will not be reversed. In respect of the disposal group held for sale, if the net amount after their fair value less
the selling expenses increased as at the subsequent balance date, the reduced amount before will be recovered and
reversed in the assets impairment loss amount recognized in non-current assets after being classified as held for
sale, and the reversed amount will be recorded in the current profits or loss. The reduced book value of the
goodwill as well as the impairment loss on assets recognized before the non-current assets are classified as held
for sale will not be reversed. The amount of subsequent reversal of the impairment losses on assets recognized in
disposal group held for sale, shall be increased proportionately to the carrying amount of each non-current asset in
the disposal group other than goodwill to which the measurement provisions of the is standards applied, based on
its proportionate share of the carrying amount.
In respect of loss of control in a subsidiary arising from disposal of the investment in such subsidiary, the
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investment in a subsidiary shall be classified as held for sale in its entirety in the individual financial statement of
the parent company, and all the assets and liabilities of the subsidiary shall be classified as held for sale in the
consolidated financial statement subject to that the proposed disposal of investment in the subsidiary satisfies such
conditions as required for being classified as held for sale notwithstanding part equity investment will be retained
by the Company after such disposal.
19. Debt investment
20. Other debt investment
21. Long-term account receivable
22. Long-term equity investment
(1)Recognition of investment costs
1) If it is formed by the business combination under the common control, and that the combining party takes cash
payment, transfer of non-cash assets, assumption of debts or issuance of equity securities as the consolidation
consideration, the shares of the book value of the owner’s equity obtained from the combined party on the date of
combination in the ultimate controlling party’s consolidated financial statements shall be recognized as its initial
investment cost. Capital reserves shall be adjusted according to the balance between the initial investment cost for
long-term equity investment and the book value of paid consolidation consideration or the total face value of
issued shares (capital premium or equity premium). If capital reserves are insufficient for offset, retained earnings
shall be adjusted.
As for business combination under the common control realized by the Company through several transactions, the
initial investment cost of the investment shall be determined based on the share of the carrying value of the
owners’ equity of the consolidated party as calculated according to the shareholding proportion on the
consolidation date. Difference between initial investment cost and the carrying value of long-term equity
investment before combination and the sum of carrying value of newly paid consideration for additional shares
acquired on the date of combination is to adjust capital reserve (capital premium or equity premium). If the
balance of capital reserve is insufficient, any excess is adjusted to retained earnings.
2) As for long-term equity investment formed from business combination not under common control, the fair
value of the consolidated consideration paid shall be deemed as the initial investment cost on the acquisition date.
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3) Except those ones formed by the business combination, for all items obtained by means of cash payment,
actually paid acquisition costs shall be taken as the initial investment cost. For those ones obtained by the issuance
of equity securities, the fair value of the issued equity securities shall be taken as the initial investment cost. For
those ones invested by investors, the value agreed in the investment contract or agreement shall be taken as the
initial investment cost, provided that the value agreed in the contract or agreement shall be fair.
(2)Subsequent measurement and profit or loss recognition
For a long-term equity investment where the CBC can exercise control over the investee, the long-term
investment is accounted for using the cost method in the Company’s financial statements. The equity method is
adopted when the Group has joint control, or exercises significant influence on the investee.
Under cost method, long term equity investment is measured at initial investment cost. Except for the price
actually paid for obtaining the investment or the cash dividends or profits declared but not yet distributed which is
included in the consideration, the Company recognizes cash dividends or profits declared by the investee as
current investment gains, and determine whether there is impairment on long term investment according to
relevant assets impairment policies.
Under equity method, when the initial investment cost of the long-term equity investment exceeds the share of fair
value in the net identifiable assets in the investee, the difference shall be included in initial investment cost of the
long-term equity investment. When the initial investment cost is lower than the share of fair value in the net
identifiable asset in the investee, such difference is recognized in profit or loss for the period with adjustment of
cost of the long-term equity investment.
Under equity method, after the Company acquires a long-term equity investment, it shall, in accordance with its
attributable share of the net profit or loss realized by the investee, recognize the investment profit or loss and
adjust carrying value of the investment. The Group recognizes its share of the investee’s net profits or losses after
making appropriate adjustments to the investee’s net profits and losses based on the fair value of the investee’s
identifiable assets at the acquisition date, using the Group’s accounting policies and periods, and eliminating the
portion of the profits or losses arising from internal transactions with its joint ventures and associates, attributable
to the investing entity according to its shareholding proportion (but impairment losses for assets arising from
internal transactions shall be recognized in full). The carrying amount of the investment is reduced based on the
Group’s share of any profit distributions or cash dividends declared by the investee. The CBC’s share of net losses
of the investee is recognized to the extent the carrying amount of the investment together with any long-term
interests that in substance form part of its net investment in the investee is reduced to zero, except that the Group
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has the obligations to assume additional losses. The CBC adjusts the carrying amount of the long-term equity
investment for any changes in owners’ equity of the investee (other than net profits or losses) and includes the
corresponding adjustments in the owners’ equity of the Group.
(3) Determination of control and significant influence on investee
Control is the power over an investee. An investor must have exposure or rights to variable returns from its
involvement with the investee, and the ability to use its power over the investee to affect the amount of the
investor’s returns. Significant influence is the power to participate in the financial and operating policy decisions
of the investee but is not control or joint control with other parties over those policies
(4)Disposal of long-term equity investment
1) Partial disposal of long term investment in which control is retained
When long term investment is been partially disposed but control is retained by the company, the difference
between disposal proceeds and carrying amount of the proportion being disposed is accounted for through profit
or loss.
2) Partial disposal of long term investment in which control is lost
When long term investment is partially disposed and control is lost as a result, the carrying value of the long term
invest on the stock right, the difference between carrying amount of the part being disposed and disposal proceeds
should be recognized as profit or loss. The residual part should be treated as long term investment or other
financial assets according to their carrying amount. After partial disposal, if the company is able to exert
significant influence or common control over the investee, the investment should be measured according to cost
method or equity method, in compliance with relevant accounting standards and regulations.
(5)Impairment test and provision for impairment
If there is objective evidence on the balance sheet date showing investment in subsidiaries, associates and joint
ventures is impaired, provision of impairment shall be made against the difference between the carrying amount
and the recoverable amount of the investment.
23. Investment real estate
Measurement mode
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Measured by cost method
Depreciation or amortization method
(1) Investment real estate including land use right which has been rented out, land use right which is held for
transfer upon appreciation and buildings which has been rented out.
(2) Investment real estate are initially measured at cost and subsequently measured as per the cost pattern, and
relevant withdrawal of provision for depreciation or amortization is carried out by the same method for fixed
assets and intangible assets. As of the balance sheet date, where there is any indication that an Investment real
estate experiences impairment, the relevant impairment provision shall be provided for based on the difference
between the carrying value and the recoverable amount.
24. Fix assets
(1) Recognition conditions
Fixed assets refer to the tangible assets for production of products, provision of labor, lease or operation, and with a service life in
excess of one financial year.
Fixed assets are recorded at the actual cost at the time of acquisition, and depreciation is calculated and withdrawn using the average
life method from the month after they reach the intended usable state
(2) Depreciation methods
Yearly depreciation
Category Method Years of depreciation Scrap value rate
rate
Straight-line
Houses and buildings 20 years 10% 4.5%
depreciation
Straight-line
Machinery equipment 10 years 10% 9%
depreciation
Transportation Straight-line
5 years 10% 18%
equipment depreciation
Electronic equipment Straight-line
5 years 10% 18%
and others depreciation
(3) Recognition basis, valuation and depreciation method for financial lease assets
Finance lease is determined when one or a combination of the following conditions are satisfied: 1) the ownership
has been transferred to the lessee when the leasing term is due; 2) the lessee has the option to purchase the leasing
asset at a price that is much lower than its fair value, so it can be reasonably determined that the lessee will take
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the option at the very beginning of the lease; 3) the leasing term accounts for most time of the useful life
(ordinarily accounting for 75% or higher) even if the ownership does not transfer to the lessee; 4) the present
value of the minimum amount of rent that the lessee has to pay at the first day of the lease amounts to 90% or
higher of its fair value at the same date; or the present value of the minimum amount of rent that the lessor collects
at the first day of the lease amounts to 90% or higher of its fair value at the same date; and/or 5) the leased assets
are of such a specialized nature that only the lessee can use them without major modifications. Fixed assets
rented-in under finance lease are recorded at the lower of fair value and the present value of the minimum lease
payment at the inception of the lease, and are depreciated following the depreciation policy for self-owned fixed
assets.
25. Construction in progress
(1)When the construction in progress has reached the intended condition for use, it will be treated as fixed assets
as per the actual construction cost. If the construction in progress has reached the intended condition for use but
completion accounting is not carried out, the construction in progress should be first treated as fixed assets as per
the estimated value. After completion accounting is carried out, the original estimated value should be adjusted as
per the actual cost, but the provision for depreciation withdrawn should not be adjusted.
(2)As of the balance sheet date, where there is any indication that a construction in process experiences
impairment, the relevant impairment provision shall be provided for based on the difference between the carrying
value and the recoverable amount.
26. Borrowing expenses
27. Biological assets
28. Oil and gas asset
29. Right-of-use assets
On the commencement date of the lease term, the Group recognizes right-of-use assets and lease liabilities for
leases, except for short-term leases and leases of low-value assets that are simplified by the standard.
The Group initially measures right-of-use assets at cost. This cost includes:
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1. The initial measurement amount of the lease liability;
2. The lease payment amount paid on or before the commencement date of the lease term, if there is a lease
incentive, deduct the relevant amount of the lease incentive already enjoyed;
3. Initial direct costs incurred;
4. The expected cost of demolishing and removing the leased asset, restoring the site where the leased asset is
located or restoring the leased asset to the condition as agreed in the lease terms. If the aforementioned cost is
incurred for the production of inventories, and the Accounting Standards for Business Enterprises No. 1 -
Inventories shall apply.
The Group recognizes and measures the cost mentioned in Item 4 above in accordance with Accounting Standards
for Business Enterprises No. 13 - Contingencies.
Initial direct costs are the incremental cost incurred to achieve the lease. Incremental cost is the cost that would
not have incurred if the enterprise had not acquired the lease.
With reference to the relevant depreciation provisions of Accounting Standards for Business Enterprises No. 4 -
Fixed Assets, the Group accrues depreciation for right-of-use assets. Where it can be reasonably determined that
the ownership of the leased asset will be obtained at the expiration of the lease term, depreciation shall be accrued
within the remaining service life of the leased asset. Where it cannot be reasonably determined that the ownership
of the leased asset can be obtained at the expiration of the lease term, depreciation shall be accrued within the the
shorter of the lease term and the remaining service life of the leased asset.
In accordance with the Accounting Standards for Business Enterprises No. 8 - Impairment of Assets, the Group
determines whether the right-of-use asset is impaired, and performs accounting treatment on the identified
impairment losses.
30. Intangible assets
(1) Valuation method, service life and impairment test
1).Intangible assets include land use right, patent right and non-patent technology, which should be initially
measured at cost.
2).Intangible assets with limited service life should be amortized systematically and reasonably in their service
lives as per the expected form of realization economic benefits relating to the said intangible assets. If the form of
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realization cannot be reliably determined, the intangible assets should be amortized on a straight-line basis.
3).At the balance sheet date, when there is any indication that the intangible assets with finite useful lives may be
impaired, a provision for impairment loss is recognized on the excess of the carrying amounts of the assets over
their recoverable amounts. Intangible assets with infinite useful lives and intangible assets not satisfying the
condition for use yet are subject to impairment test each year notwithstanding whether the assets are impaired.
(2) Internal accounting policies relating to research and development expenditures
Expenditure incurred in the research phase of internal R&D shall be included in current gain/loss at the time of
occurrence. Intangible assets recognized for expenditure in exploitation stage by satisfying the followed at same
time: ①it is technically feasible that the intangible asset can be used or sold upon completion; ②there is intention
to complete the intangible asset for use or sale; ③the intangible asset can produce economic benefits, including
there is evidence that the products produced using the intangible asset has a market or the intangible asset itself
has a market; if the intangible asset is for internal use, there is evidence that there exists usage for the intangible
asset; ④there is sufficient support in terms of technology, financial resources and other resources in order to
complete the development of the intangible asset, and there is capability to use or sell the intangible asset; ⑤the
expenses attributable to the development phase of the intangible asset can be measured reliably.
31. Impairment of long-term assets
32. Long-term expenses to be apportioned
Long-term expenses to be apportioned are booked by actual amount occurred, and apportioned evenly during the
benefit period or regulated period.In case that the long-term deferred expenses are not likely to benefit the
subsequent accounting periods, the outstanding value of the item to be amortized shall be included in current
profit or loss in full.
33. Contractual liability
The CBC lists contractual assets or contractual liabilities in the balance sheet based on the relationship between
performance obligations and customer payments. The CBC's obligations to transfer goods or provide services to
customers for which consideration has been received or receivable are listed as contractual liabilities. contractual
assets and contractual liabilities under the same contract are listed as a net amount.
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34. Employee compensation
(1) Accounting treatment for short-term compensation
During the accounting period when staff providing service to the CBC, the actual short-term compensation
occurred shall recognized as liabilities and reckoned into current gains/losses or relevant assets costs. The non-
monetary welfare is measured by fair value.
(2) Accounting treatment for post-employment benefit
The CBC terminates the labor relationship with an employee before the employee labor contract expires, or
proposes to offer a compensation to encourage an employee to voluntarily accept the downsizing. When the CBC
cannot unilaterally withdraw the labor relationship cancellation plan or the downsizing proposal nor confirm the
relevant costs of the restructuring involving the payment of termination benefits, whichever is earlier, the
liabilities arising from the compensation for the termination of the labor relationship with the employees are
recognized and included in the current profit and loss.
(3) Accounting for retirement benefits
When the CBC terminates the employment relationship with employees before the end of the employment
contracts or provides compensation as an offer to encourage employees to accept voluntary redundancy, the CBC
shall recognize employee compensation liabilities arising from compensation for staff dismissal and included in
profit or loss for the current period, when the CBC cannot revoke unilaterally compensation for dismissal due to
the cancellation of labor relationship plans and employee redundant proposals; and the CBC recognize cost and
expenses related to payment of compensation for dismissal and restructuring, whichever is earlier.
(4) Accounting for other long-term employee benefits
The employees of the CBC have participated in the basic social endowment insurance organized and implemented
by the local labor and social security department. The CBC pays the endowment insurance premium to the local
basic social endowment insurance agency on a monthly basis based on the base and ratio of the local basic social
endowment insurance payment. After the retirement of employees, the local labor and social security department
has the responsibility to pay the social basic pension to the retired employees. During the accounting period in
which employees provide services, the CBC recognizes the amount payable calculated according to the above
social security insurance regulations as the liabilities and includes them in the current profit and loss or related
asset costs.
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35. Lease liability
36. Accrual liability
37. Share-based payment
(1)Types of share-based payment
Share-based payment comprises of equity-settled share-based payment and cash-settled share-based payment.
(2)Determination of fair value of equity instruments
1)determined based on the price quoted in an active market if there exists active market for the instrument.
2)determined by adoption of valuation technology if there exists no active market, including by reference to the
recent arm’s length market transactions between knowledgeable, willing parties, reference to the current fair value
of another instrument that is substantially the same, discounted cash flow analysis and option pricing models.
(3)Basis for determination of the best estimate of exercisable equity instruments
To be determined based on the subsequent information relating to latest change of exercisable employees.
(4)Accounting relating to implementation, amendment and termination of share-based payment schemes
1)Equity-settled share-based payment
For equity instruments that may be exercised immediately after the grant, the fair value of such instrument shall,
on the date of the grant, be recognized in relevant costs or expenses with the increase in the capital reserve
accordingly. For equity-settled share-based payment made in return for the rendering of employee services that
cannot be exercised until the services are fully rendered during vesting period or specified performance targets are
met, on each balance sheet date within the vesting period, the services acquired in the current period shall, based
on the best estimate of the number of exercisable instruments, be recognized in relevant costs or expenses and the
capital reserves at the fair value of such instruments on the date of the grant.
For equity-settled share-based payment made in exchange for service from other parties, such payment shall be
measured at the fair value of the service as of the acquisition date is the fair value can be measured reliably. And if
the fair value of the service cannot be measured reliably while the fair value of the equity instrument can be
measured reliably, it shall be measure at the fair value of the instrument as of the date on which the service is
acquired, which shall be recorded in relevant cost or expense with increase in owners’ equity accordingly.
2)Cash-settled share-based payment
For the cash-settled share-based payment that may be exercised immediately after the grant in exchange for render
of service by employees, the fair value of the liability incurred by the CBC shall, on the date of the grant, be
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recognized in relevant costs or expenses and the liabilities shall be increased accordingly. For cash-settled share-
based payment made in return for the rendering of employee services that cannot be exercised until the services
are fully provided during vesting period or specified performance targets are met, on each balance sheet date
within the vesting period, the services acquired in the current period shall, based on the best estimate of the
number of exercisable instruments, be recognized in relevant costs or expenses and the corresponding liabilities at
the fair value of the liability incurred by the CBC.
3)Revision and termination of share-based payment schemes
If the revision results in an increase in the fair value of the equity instruments granted, the CBC shall recognize
the increase in the services rendered accordingly at the increased fair value of the equity instruments. If the
revision results in an increase in the number of equity instruments granted, the CBC will recognize the increase in
the services rendered accordingly at the fair value of the increased number of equity instruments. If the CBC
revises the vesting conditions on terms favorable to the employees, the CBC will take into consideration of the
revised vesting conditions when dealing with the vesting conditions.
If the revision results in a decrease in the fair value of the equity instruments granted, the CBC shall continue
recognize the amount of services rendered accordingly at the fair value of the equity instruments on the date of
grant without considering the decrease in the fair value of the equity instruments. If the revision results in a
decrease in the number of equity instruments granted, the CBC will account for such decrease by reducing part of
the cancellation of equity instruments granted. If the CBC revises the vesting conditions on terms not favorable to
the employees, the CBC will not take into consideration of the revised vesting conditions when dealing with the
vesting conditions.
If the CBC cancels the equity instruments granted or settles the equity instruments granted during the vesting
period (other than cancellation as a result of failure to satisfy the vesting conditions), such cancellation or
settlement will be treated as accelerated exercisable rights and the original amount in the remaining vesting period
will be recognized immediately.
38. Other financial instruments including preferred stock and perpetual bonds
39. Revenue
The Company shall comply with the disclosure requirement of jewelry-related industries in the “Shenzhen Stock Exchange Self-
Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”
(1) Recognition of revenue
147
On the starting date of the contract, the company evaluates the contract, identifies each individual performance
obligation contained in the contract, and determines whether each individual performance obligation is performed
within a certain period of time or at a certain point in time.
When meeting one of the following conditions, it belongs to the performance obligation within a certain period of
time, otherwise, it belongs to the performance obligation at a certain point in time: 1) The customer obtains and
consumes the economic benefits brought by the company's performance at the same time as the company
performs the contract; 2) The customer can control the goods or services under construction during the company's
performance; 3) The goods or services produced during the company's performance have irreplaceable uses, and
the company has the right to collect payments for the accumulated performance part of the contract during the
entire contract period .
For performance obligations performed within a certain period of time, the company recognizes revenue in
accordance with the performance progress during that period of time. When the performance progress cannot be
reasonably determined, if the cost incurred is expected to be compensated, the revenue shall be recognized
according to the amount of the cost incurred until the performance progress can be reasonably determined. For
performance obligations performed at a certain point in time, revenue is recognized at the point when the
customer obtains control of the relevant goods or services. When judging whether the customer has obtained
control of the goods, the company considers the following signs: 1) The company has the current right to receive
payment for the goods, that is, the customer has the current payment obligation for the goods; 2) The company has
transferred the legal ownership of the goods to the customer, that is, the customer has legal ownership of the
goods; 3) The company has transferred the product to the customer in kind, that is, the customer has physically
taken possession of the product; 4) The company has transferred the major risks and rewards of the ownership of
the goods to the customer, that is, the customer has obtained the main risks and rewards of the ownership of the
goods; 5) the customer has accepted the goods; 6) Other signs indicate that the customer has obtained control of
the goods.
(2) Principles of revenue measurement
1) The company measures revenue based on the transaction price allocated to each individual performance
obligation. The transaction price is the amount of consideration that the company expects to be entitled to receive
due to the transfer of goods or services to the customer, and does not include the amount collected on behalf of a
third party and the amount expected to be returned to the customer.
2) If there is variable consideration in the contract, the company shall determine the best estimate of the variable
consideration based on the expected value or the amount most likely to incur, but the transaction price including
148
the variable consideration shall not exceed the amount at which the accumulatively recognized income is most
likely not be subject to a significant reversal when the relevant uncertainty is eliminated.
3) If there is a major financing component in the contract, the company shall determine the transaction price based
on the amount payable in cash when the customer assumes control of the goods or services. The difference
between the transaction price and the contract consideration shall be amortized by the effective interest method
during the contract period. On the starting date of the contract, if the company expects that the interval between
the customer's acquisition of control of the goods or services and the customer's payment of the price will not
exceed one year, we will not consider the significant financing components in the contract.
4) If the contract contains two or more performance obligations, the company will allocate the transaction prices
to each individual performance obligation in accordance with the relative proportion of the stand-alone selling
price of the goods promised by each individual performance obligation on the commencement date of contract.
(3) Specific method of revenue recognition:
In accordance with the general principles of revenue recognition and the actual situation of the company's product
sales, the company formulates a specific revenue recognition method that the products sold by the company to
customers are recognized as revenue after the products are delivered to the customer and the customer carries out
acceptance and inspection.
40. Government subsidy
(1) government subsidy including those relating to assets and relating to income
(2)government grant, if granted as monetary assets, are measured at the amount received or receivable, and
measured at fair value if granted as non-monetary assets. If the fair value can not be determined reliably, they
shall be measured at nominal value.
(3) Aggregate method for government subsidy:
1)government subsidy relating to assets are recognized as deferred income, which shall be recorded in profit or
loss by installment reasonably and systematically within the useful life of the assets. If assets are sold, transferred,
discarded as useless or damaged prior to expiration of the useful life, the remaining deferred income undistributed
shall be transferred to profit or loss for the period in which the assets are disposed.
2)If government subsidy relating to income are used to compensate for relevant costs or loss for the subsequent
149
periods, they shall be recognized as deferred income, and recorded in profit or loss for the period in which the
relevant costs are recognized. If government subsidy relating to income are used to compensate for the relevant
costs or loss occurred, they shall be recorded in profit or loss for the period directly.
(4)Net method for government subsidy
1) government subsidy relating to assets are used to write off the carrying value of the relevant assets;
2) If government subsidy relating to income are used to compensate for relevant costs or loss for the subsequent
periods, they shall be recognized as deferred income, and recorded in profit or loss for the period in which offset
against the relevant costs. If government subsidy relating to income are used to compensate for the relevant costs
or loss occurred, they shall be offset against the relevant costs for the period directly.
(5)The CBC adopts aggregated accounting method for the government subsidy received.
(6)As for the government subsidy comprising both portions relating to assets and income, separate accounting
shall be made for different portion; in case it is hard to differentiate the portions, the subsidy will be recorded as
related to income in general.
(7)The CBC realizes government subsidy relating to its normal activities as other income based on the substance
of economic business, and if not related to its normal activities, realized as non-operating income and expenditure.
(8)Subsidized loans from preferential policy obtained by the CBC are classified based on whether subsidy funds
are paid to the loaning bank or directly to the CBC by the competent financial authorities and are treated based on
the following principles:
1)Where subsidy funds are paid to the loaning bank by the competent financial authorities and the bank then
provides loans to the CBC at a preferential policy rate, accounting shall be made by the CBC as follows:
a. Recognizes the actual borrowing amount received as the carrying value of the loan, and calculates the relevant
borrowing costs based on the principal and the preferential policy rate.
b.Recognizes the fair value of the loan as the carrying value and calculates the borrowing cost under effective
150
interest method, and recognizes the difference between the actual amount received and the fair value of the loan as
deferred income. Deferred income is amortized over the term of the loan under effective interest method and
offset against the relevant borrowing costs.
2)If the subsidy funds are paid directly to the CBC by finance authority, the CBC will offset the corresponding
subsidy against the relevant borrowing expenses.
41. Deferred income tax asset /Deferred income tax liabilities
(1) Deferred tax assets or deferred tax liabilities are calculated and recognized based on the difference between the
carrying amount and tax base of assets and liabilities (and the difference of the carrying amount and tax base of
items not recognized as assets and liabilities but with their tax base being able to be determined according to tax
laws) and in accordance with the tax rate applicable to the period during which the assets are expected to be
recovered or the liabilities are expected to be settled.
(2)A deferred tax asset is recognized to the extent of the amount of the taxable income, which it is most likely to
obtain and which can be deducted from the deductible temporary difference. At the balance sheet date, if there is
any exact evidence that it is probable that future taxable profits will be available against which deductible
temporary differences can be utilized, the deferred tax assets unrecognized in prior periods are recognized.
(3)At the balance sheet date, the carrying amount of deferred tax assets is reviewed. The carrying amount of a
deferred tax asset is reduced to the extent that it is no longer probable that sufficient taxable profits will be
available to allow the benefit of the deferred tax asset to be utilized. Such reduction is subsequently reversed to
the extent that it becomes probable that sufficient taxable income will be available.
(4)The income tax and deferred tax for the period are treated as income tax expenses or income through profit or
loss, excluding those arising from the following circumstances: ① business combination; and ② the transactions
or items directly recognized in equity.
151
42. Lease
(1)Accounting for operating lease
When the Company is the lessee, lease payments are recognized as cost or profit or loss with straight-line method
over the lease term. Initial expenses are recognized directly into profit or loss. Contingent rents are charged as
profit or loss in the periods in which they are incurred.
When the Company is the lessor, lease income is recognized as profit or loss with straight-line method over the
lease term. Initial expenses, other than those with material amount and eligible for capitalization which are
recognized as profit or loss by installments, are recognized directly as profit or loss. Contingent rents are charged
into profit or loss in the periods in which they are incurred.
(2)Accounting for financing lease
When the company acts as lessee, at the inception of lease, the lower of fair value of leased assets at the inception
of lease and the present value of minimum lease payment is recognized as the value of leased assets. The
minimum lease payment is recognized as the value of long-term payable. Their difference is recorded as
unrecognized finance costs with any initial direct expense incurred recorded in the value of leased assets. For each
period of the lease term, current finance cost is calculated using effective interest method.
When the company acts as lessor, at the inception of lease, the sum of minimum lease income at the inception of
lease and the initial direct expense is recognized as the value of finance lease payment receivable, with unsecured
balance also recorded. The difference between the sum of minimum lease income, initial direct expense and
unsecured balance and the sum of their present values is recognized as unrealized finance income. For each period
of the lease term, current finance income is calculated using effective interest method.
43. Other important accounting policy and estimation
Discontinued operation refers to the operation disposed or classified as held-for-sale by the Company and
presented separately under operation segments and financial statements, which has fulfilled one of the following
criteria:
(1) it represents an independent key operation or key operating region;
(2) it is part of the proposed disposal plan on an independent key operation or proposed disposal in key operating
region; or
(3) it only establishes for acquisition of subsidiary through disposal.
The enterprise shall separately list profit and loss from continuing operations and profit and loss from
discontinuing operations in the profit statement. For non-current assets held for sale or disposal groups that do not
152
meet the definition of discontinuing operations, the impairment losses and reversal amounts and disposal gains
and losses should be presented as profit or loss from continuing operations. Operational gains and losses and
disposal profits and losses such as impairment losses and reversal amounts of discontinuing operations should be
reported as profits or losses of discontinuing operations.
44. Changes of important accounting policy and estimation
(1) Changes of important accounting policy
Applicable □Not applicable
The contents and reasons of accounting
Examination and approval procedures Note
policy changes
(1)After approved by the BOD, relevant regulations with “Explanation of the Accounting Standards for Business Enterprise
No.15”(CK[2021]No.35) concerned are applicable since 1 January 2022, change of this accounting policy has no impact on the
financial statement in the Period.
(2)After approved by the BOD, relevant regulations with “Explanation of the Accounting Standards for Business Enterprise
No.16”(CK[2022]No.31) concerned are applicable since 1 January 2022, change of this accounting policy has no impact on the
financial statement in the Period.
(2) Changes of important accounting estimation
Applicable □Not applicable
Contents and reasons for Examination and approval
Starting point of application Note
change procedures
No important changes in accounting estimation occurred during the reporting period.
45. Other
There were no major error correction on prior period in the reporting period.
The adjustment of financial statement at the beginning of the year when first implemented the new accounting standards or
explanations since 2022
VI. Taxes
1. Main tax and tax rate
Type of tax Tax calculation evidence Tax rate
Sales of goods, taxable labor service
revenue, taxable income, intangible
Value added tax 5%, 6%, 13%
assets income and income from property
leasing
City maintenance & construction tax Turnover tax payable 7%
153
Enterprise income tax Taxable income 25%, 20%, 15%
Disclose reasons for different taxpaying body
Taxpaying body Income tax rate
The CBC 25.00%
Shenzhen Emmelle Industrial Co., Ltd. 20.00%
Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd 20.00%
Shenzhen Emmelle Cloud Technology Co., Ltd. 20.00%
2. Tax preference
According to the "Enterprise Income Tax Law of the People's Republic of China" and its implementation regulations, the "Notice of
the State Taxation Administration and Ministry of Finance on the Implementation of Inclusive Tax Relief Policies for Small and
Micro Enterprises" (CS[2019] No. 13) and other provisions, from January 1, 2019 to December 31, 2021, the portion of the annual
taxable income of small, low-profit enterprises that does not exceed 1 million yuan will be included in the taxable income by 25%,
and the corporate income tax will be paid at a tax rate of 20%. The portion of the annual taxable income of small, low-profit
enterprises exceeding 1 million yuan but not exceeding 3 million yuan will be included in the taxable income by50%, and the
corporate income tax will be paid at a tax rate of 20%. Subsidiary of CBC- Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd.,
Shenzhen Emmelle Industrial Co., Ltd and Shenzhen Emmelle Cloud Technology Co., Ltd., are small and low-profit enterprises,
therefore a preferential tax rate of 20% is applies.
3. Other
Nil
VII. Notes to Items in the Consolidated Financial Statements
1. Monetary fund
Unit: RMB/CNY
Item Ending balance Opening balance
Cash on hand 33,531.25 27,587.25
Bank deposit 50,979,338.10 33,219,370.67
Other monetary fund 3,686,621.83
Total 54,699,491.18 33,246,957.92
Total amount that have
restriction on use due to mortgage, 3,776,621.83
pledge or frozen
Other explanation:
At the end of the period, there are no funds deposited overseas or with potential recovery risks.
2. Trading financial assets
Unit: RMB/CNY
Item Ending balance Opening balance
Including:
154
Including:
Other explanation:
Nil
3. Derivative financial assets
Unit: RMB/CNY
Item Ending balance Opening balance
Other explanation:
Nil
4. Note receivable
(1) Category
Unit: RMB/CNY
Item Ending balance Opening balance
Bank acceptance notes 1,102,000.00
Total 1,102,000.00
Unit: RMB/CNY
Ending balance Opening balance
Categor Book balance Bad debt provision Book balance Bad debt provision
y Book Book
Accrual value Accrual value
Amount Ratio Amount Amount Ratio Amount
ratio ratio
Includ
ing:
Includ
ing:
If the provision for bad debts of notes receivable is made in accordance with the general model of expected credit losses, please
refer to the disclosure of other account receivable to disclose related information about bad-debt provisions:
□Applicable Not applicable
(2) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
Unit: RMB/CNY
Current changes
Opening
Category Collected or Ending balance
balance Accrual Write off Other
reversal
Including important amount of bad debt provision collected or reversal in the period:
□Applicable Not applicable
155
(3) Note receivable pledged at period-end
Unit: RMB/CNY
Item Amount pledged at period-end
(4) Note receivable which have endorsed and discount at period-end and has not expired on balance sheet
date
Unit: RMB/CNY
Item Amount derecognition at period-end Amount not derecognition at period-end
Bank acceptance notes 470,000.00 2,470,000.00
Total 470,000.00 2,470,000.00
(5)Notes transfer to account receivable due for failure implementation by drawer at period-end
Unit: RMB/CNY
Item Amount transfer to account receivable at period-end
Other explanation:
Nil
(6) Note receivable actually written-off in the period
Unit: RMB/CNY
Item Amount written off
Including important note receivable written-off:
Unit: RMB/CNY
Amount cause by
Amount written related
Enterprise Nature Causes Procedure
off transactions or not
(Y/N)
Explanation on note receivable written-off:
Nil
5. Account receivable
(1)Category
Unit: RMB/CNY
Ending balance Opening balance
Categor Book balance Bad debt provision Book balance Bad debt provision
y Book Book
Accrual value Accrual value
Amount Ratio Amount Amount Ratio Amount
ratio ratio
Account 26,197,9 21,516,0 4,681,90 24,072,4 7,229,28 16,843,1
9.62% 82.13% 34.94% 30.03%
receivab 73.35 69.69 3.66 36.14 5.93 50.21
156
le with
bad debt
provisio
n accrual
by single
basis
Includ
ing:
Account
s with
single
significa
nt
amount
but with 21,862,8 17,490,2 4,372,56 18,925,6 3,785,13 15,140,5
8.03% 80.00% 34.94% 20.00%
bad 32.43 65.94 6.49 66.88 3.38 33.50
debts
provisio
n
accrued
individu
ally
Account
s with
single
minor
amount
but with
4,335,14 4,025,80 309,337. 5,146,76 3,444,15 1,702,61
bad 1.59% 92.86% 9.50% 66.92%
0.92 3.75 17 9.26 2.55 6.71
debts
provisio
n
accrued
individu
ally
Account
receivab
le with
bad debt 246,125, 738,377. 245,387, 30,097,2 90,291.6 30,006,9
90.38% 0.30% 55.56% 0.30%
provisio 775.60 33 398.27 25.06 8 33.38
n accrual
by
portfolio
Includ
ing:
Account
receivab
le
withdra
wal bad
246,125, 738,377. 245,387, 30,097,2 90,291.6 30,006,9
debt 90.38% 0.30% 55.56% 0.30%
775.60 33 398.27 25.06 8 33.38
provisio
n by
group of
credit
risk
157
characte
ristics
(Aging
analysis
method)
272,323, 22,254,4 250,069, 54,169,6 7,319,57 46,850,0
Total 100.00% 100.00% 13.51%
748.95 47.02 301.93 61.20 7.61 83.59
Bad debt provision accrual on single basis: The account receivable of CBC with a single significant amount refers to a single
amount of 5 million yuan or more
Unit: RMB/CNY
Ending balance
Name
Book balance Bad debt provision Accrual ratio Reason for accrual
Guangshui Jiaxu
Expected partial
Energy Technology 21,862,832.43 17,490,265.94 80.00%
uncollectible
Co., Ltd.
Total 21,862,832.43 17,490,265.94
Bad debt provision accrual on single basis: Accounts with single minor amount but with bad debts provision accrued individually
Unit: RMB/CNY
Ending balance
Name
Book balance Bad debt provision Accrual ratio Reason for accrual
Suzhou Daming
Expected to be difficult
Vehicle Industry Co., 944,014.42 755,211.54 80.00%
to recover
Ltd.
Suzhou Jiaxin
Expected to be difficult
Economic Trade Co., 888,757.00 888,757.00 100.00%
to recover
Ltd.
Dongguan Daxiang Expected to be difficult
676,734.00 676,734.00 100.00%
New Energy Co., Ltd. to recover
Shijiazhuang Dasong Expected to be difficult
497,064.00 497,064.00 100.00%
Tech. Co., Ltd to recover
Guangdong Xinlingjia Expected to be difficult
348,136.00 348,136.00 100.00%
New Energy Co., Ltd. to recover
Shanghai Swen
Expected to be difficult
Electric Vehicle Co., 280,197.50 280,197.50 100.00%
to recover
Ltd.
Hubei Topsdun
Expected to be difficult
Eletronic Tech. Co., 241,068.58 120,534.29 50.00%
to recover
Ltd.
Tianjin Huihui Electric Expected to be difficult
116,840.14 116,840.14 100.00%
Vehicle Co., Ltd. to recover
Fuzhou Dayang Expected to be difficult
147,804.28 147,804.28 100.00%
Commercial Co., Ltd. to recover
Expected to be difficult
Other 194,525.00 194,525.00 100.00%
to recover
Total 4,335,140.92 4,025,803.75
Bad debt provision accrual on portfolio:Accounts receivable with provision for bad debts by aging analysis method
Unit: RMB/CNY
Ending balance
Name
Book balance Bad debt provision Accrual ratio
Within one year(one year 245,316,931.87 735,950.80 0.30%
158
included)
1-2 years (2 years included) 1,724.11 5.17 0.30%
2-3 years (3 years included) 807,119.62 2,421.36 0.30%
Total 246,125,775.60 738,377.33
Explanation on portfolio basis:
Nil
If the provision for bad debts of account receivable is made in accordance with the general model of expected credit losses, please
refer to the disclosure of other account receivable to disclose related information about bad-debt provisions:
□Applicable Not applicable
By account age
Unit: RMB/CNY
Account age Book balance
Within one year(one year included) 245,316,931.87
1-2 years 1,724.11
2-3 years 807,119.62
Over 3 years 26,197,973.35
3-4 years 26,197,973.35
Total 272,323,748.95
(2) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
Unit: RMB/CNY
Current changes
Opening
Category Collected or Ending balance
balance Accrual Write off Other
reversal
Accrual of bad
debt provision
for account 16,220,871.61 763,930.00 522,072.20
receivable in
the Period
Total 16,220,871.61 763,930.00 522,072.20
Including important amount of bad debt provision collected or reversal in the period:
Unit: RMB/CNY
Enterprise Amount collected or reversal Collection way
(3) Account receivables actually write-off during the reporting period
Unit: RMB/CNY
Item Amount written off
Including major account receivables write-off:
Unit: RMB/CNY
159
Amount cause by
Amount written related
Enterprise Nature Causes Procedure
off transactions or not
(Y/N)
Explanation on account receivable write-off:
(4) Top five account receivables collected by arrears party at ending balance
Unit: RMB/CNY
Proportion of total closing
Ending balance of accounts Ending balance of bad bet
Enterprise balance of accounts
receivable provision
receivable
Shenzhen Yunshang Jewelry
63,230,547.34 23.22% 189,691.65
Co., Ltd.
Fuzhou Rongrun Jewelry Co.,
44,987,445.10 16.52% 134,962.34
Ltd.
Shenzhen Hualinglong
Jewelry Culture Tech. Co., 37,514,073.30 13.78% 112,542.22
Ltd.
Fuzhou Cangshan Dingjue
26,828,833.21 9.85% 80,486.50
Jewelry Firm
Guangshui Jiaxu Energy
21,862,832.43 8.03% 17,490,265.94
Technology Co., Ltd.
Total 194,423,731.38 71.40%
(5) Assets and liability resulted by account receivable transfer and continuous involvement
Other explanation:
(6) Account receivable derecognition due to transfer of financial assets
6. Receivable financing
Unit: RMB/CNY
Item Ending balance Opening balance
Change of receivables financing and fair value in the period
□Applicable Not applicable
If the provision for bad debts of receivable financing is made in accordance with the general model of expected credit losses,
please refer to the disclosure of other account receivable to disclose related information about bad-debt provisions:
□Applicable Not applicable
Other explanation:
160
7. Accounts paid in advance
(1) By account age
Unit: RMB/CNY
Ending balance Opening balance
Account age
Amount Ratio Amount Ratio
Within one year 4,285,047.15 99.96% 1,300,408.57 100.00%
1-2 years 1,888.00 0.04%
Total 4,286,935.15 1,300,408.57
Explanation on un-settlement in time for advance payment with over one year account age and major amounts:
(2) Top 5 advance payment at ending balance by prepayment object
Ratio in total advance e
Enterprise Amount Nature
payment(%)
Fujian Hengsheng Jewelry Co., Ltd. 4,000,000.00 Payment for
goods paid in 93.31
advance
Shenzhen Huamao Gold Co., Ltd. 89,384.50 Payment for
goods paid in 2.09
advance
Changzhou Ruiqi Precision Measurement Tech. 83,400.00 Payment for
Co., Ltd. goods paid in 1.95
advance
Shenzhen Cuilu Gold Business 66,708.18 Payment for
goods paid in 1.56
advance
Wenzhou Xialong Traffic Signs Co., Ltd. 23,754.00 Payment for
goods paid in 0.55
advance
Total 4,263,246.68 99.45
Other explanation:
At end of the period, there was no advance payment from shareholder unit and other related parties that holds 5% (included) voting
rights of the Company among Advance Payment
161
8. Other account receivable
Unit: RMB/CNY
Item Ending balance Opening balance
Other account receivable 438,477.82 494,695.27
Total 438,477.82 494,695.27
(1) Interest receivable
1) Category
Unit: RMB/CNY
Item Ending balance Opening balance
2) Important overdue interest
Unit: RMB/CNY
Impairment (Y/N) and
Borrower Ending balance Overdue time Overdue reason
judgment basis
Other explanation:
3) Accrual of bad debt provision
□Applicable Not applicable
(2) Dividend receivable
1) Category
Unit: RMB/CNY
Item (or the invested entity) Ending balance Opening balance
2) Important dividend receivable with over one year aged
Unit: RMB/CNY
Item (or the invested Causes of failure for Impairment (Y/N) and
Ending balance Account age
entity) collection judgment basis
3) Accrual of bad debt provision
□Applicable Not applicable
Other explanation:
162
(3) Other account receivable
1) By nature
Unit: RMB/CNY
Nature Ending book balance Opening book balance
Deposit or margin 504,107.88 576,539.00
Payment for equipment 311,400.00 311,400.00
Personal loan of employees 33,445.00 20,144.82
Other 62,744.32
Total 911,697.20 908,083.82
2) Accrual of bad debt provision
Unit: RMB/CNY
Phase I Phase II Phase III
Expected credit losses Expected credit losses
Bad debt provision Expected credit losses for the entire duration for the entire duration Total
over next 12 months (without credit (with credit impairment
impairment occurred) occurred)
Balance on January 1,
413,388.55 413,388.55
2022
January 1, 2022
balance in the current
period
Accrual in the Period 59,830.83 59,830.83
Balance on December
473,219.38 473,219.38
31, 2022
Change of book balance of loss provision with amount has major changes in the period
□Applicable Not applicable
By account age
Unit: RMB/CNY
Account age Book balance
Within one year(one year included) 319,540.20
1-2 years 11,600.00
2-3 years 108,657.00
Over 3 years 471,900.00
3-4 years 60,000.00
4-5 years 50,000.00
Over 5 years 361,900.00
Total 911,697.20
3) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
Unit: RMB/CNY
163
Current changes
Opening
Category Collected or Ending balance
balance Accrual Write off Other
reversal
Other account
receivable Bad
413,388.55 59,830.83 473,219.38
debt provision-
1st stage
Total 413,388.55 59,830.83 473,219.38
Important amount of bad debt provision switch-back or collection in the period:
Unit: RMB/CNY
Enterprise Amount switch-back or collection Collection way
Nil
4) Other account receivables actually write-off during the reporting period
Unit: RMB/CNY
Item Amount written off
Including major other account receivables write-off:
Unit: RMB/CNY
Amount cause by
Amount written related
Enterprise Other Nature Causes Procedure
off transactions or not
(Y/N)
Other Explanation on account receivable write-off:
Nil
5) Top 5 other account receivable collected by arrears party at ending balance
Unit: RMB/CNY
Proportion in total
other account Ending balance of
Enterprise Nature Ending balance Account age
receivables at bad bet provision
period-end
Shenzhen Luwei
Mechatronic Payment for
300,000.00 Over 5 years 32.91% 300,000.00
Equipment Co., equipment
Ltd
Alipay (China)
Network
Technology Co., Margin or deposit 170,000.00 Within 5 years 18.65% 110,180.00
Ltd. customer
reserve fund
Shenye Pengji
Margin or deposit 97,859.38 1-2 years 10.73% 293.58
(Group) Co., Ltd.
Xi’an Zhongjinpu
Payment for goods 62,744.32 One year 6.88% 188.23
Trading Co., Ltd.
Customer
Margin or deposit 40,103.50 Within 5 years 4.40% 120.31
provision(JD.Com
164
) of the Quick
Money Payment
Clearing
Information Co.,
Ltd.
Total 670,707.20 73.57% 410,782.12
6) Account receivable with government subsidy involved
Unit: RMB/CNY
Time, amount and
Enterprise Government subsidy Ending balance Ending account age basis of amount
collection estimated
Nil
7) Other account receivable derecognition due to financial assets transfer
Nil
8) Assets and liability resulted by other account receivable transfer and continuous involvement
Nil
Other explanation:
Nil
9. Inventory
Whether companies need to comply with the disclosure requirements of the real estate industry
No
(1) Category
Unit: RMB/CNY
Ending balance Opening balance
Provision for Provision for
inventory inventory
depreciation or depreciation or
Item contract contract
Book balance Book value Book balance Book value
performance performance
cost cost
impairment impairment
provision provision
Raw materials 22,911,015.69 22,911,015.69 5,151,013.66 4,227.80 5,146,785.86
Finished goods 25,045,073.77 412,020.87 24,633,052.90 2,917,927.37 371,836.25 2,546,091.12
Consigned
662,798.22 662,798.22 555,696.79 555,696.79
processing
165
materials
Total 48,618,887.68 412,020.87 48,206,866.81 8,624,637.82 376,064.05 8,248,573.77
The Company shall comply with the disclosure requirement of jewelry-related industries in the “Shenzhen Stock Exchange Self-
Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”
(2) Provision for inventory depreciation or contract performance cost impairment provision
Unit: RMB/CNY
Current increased Current decreased
Opening
Item Switch back or Ending balance
balance Accrual Other Other
charge-off
Raw materials 4,227.80 4,227.80
Finished goods 371,836.25 110,756.09 70,571.47 412,020.87
Total 376,064.05 110,756.09 74,799.27 412,020.87
(3) Explanation on capitalization of borrowing costs at ending balance of inventory
Nil
(4) Explanation on the current amortization amount of contract performance costs
Nil
10. Contractual assets
Unit: RMB/CNY
Ending balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Book value of contractual assets has major changes and causes:
Unit: RMB/CNY
Item Amount changes Reason for change
If the provision for bad debts of contract asset is made in accordance with the general model of expected credit losses, please refer
to the disclosure of other account receivable to disclose related information about bad-debt provisions:
□Applicable Not applicable
Accrual of impairment provision in the period
Unit: RMB/CNY
166
Switch-back in the
Item Accrual in the Period Reversal/Write off Causes
Period
Other explanation:
11. Assets held for sale
Unit: RMB/CNY
Expected
Ending book Impairment Ending book Expected
Item Fair value disposal
balance provision value disposal time
expenses
Other explanation:
Nil
12. Non-current asset due within one year
Unit: RMB/CNY
Item Ending balance Opening balance
Important debt investment/other debt investment
Unit: RMB/CNY
Ending balance Opening balance
Item Coupon Coupon
Face value Actual rate Due date Face value Actual rate Due date
rate rate
Other explanation:
Nil
13. Other current assets
Unit: RMB/CNY
Item Ending balance Opening balance
Input tax to be deducted 35,453,106.62 1,078,351.48
Issuance costs of non-public offering of
735,849.05
shares
Total 35,453,106.62 1,814,200.53
Other explanation:
14. Debt investment
Unit: RMB/CNY
Ending balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Important debt investment
167
Unit: RMB/CNY
Debt Ending balance Opening balance
investment Coupon Coupon
Face value Actual rate Due date Face value Actual rate Due date
rate rate
Accrual of impairment provision
Unit: RMB/CNY
Phase I Phase II Phase III
Expected credit losses Expected credit losses
Bad debt provision Expected credit losses for the entire duration for the entire duration Total
over next 12 months (without credit (with credit impairment
impairment occurred) occurred)
January 1, 2022
balance in the current
period
Change of book balance of loss provision with amount has major changes in the period
□Applicable Not applicable
Other explanation:
15. Other debt investment
Unit: RMB/CNY
Cumulative
loss
Change of impairment
Cumulative
Opening Accrued fair value Ending recognized
Item Cost changes of Note
balance interest in the balance in other
fair value
period comprehen
sive
income
Important other debt investment
Unit: RMB/CNY
Other debt Ending balance Opening balance
investment Coupon Coupon
Face value Actual rate Due date Face value Actual rate Due date
rate rate
Accrual of impairment provision
Unit: RMB/CNY
Phase I Phase II Phase III
Expected credit losses Expected credit losses
Bad debt provision Expected credit losses for the entire duration for the entire duration Total
over next 12 months (without credit (with credit impairment
impairment occurred) occurred)
January 1, 2022
balance in the current
period
Change of book balance of loss provision with amount has major changes in the period
□Applicable Not applicable
Other explanation:
168
Nil
16. Long-term account receivable
(1) Long-term account receivable
Unit: RMB/CNY
Ending balance Opening balance
Discount rate
Item Bad debt Bad debt
Book balance Book value Book balance Book value interval
provision provision
Impairment of bad debt provision
Unit: RMB/CNY
Phase I Phase II Phase III
Expected credit losses Expected credit losses
Bad debt provision Expected credit losses for the entire duration for the entire duration Total
over next 12 months (without credit (with credit impairment
impairment occurred) occurred)
January 1, 2022
balance in the current
period
Change of book balance of loss provision with amount has major changes in the period
□Applicable Not applicable
Nil
(2) Long-term account receivable derecognized due to financial assets transfer
Nil
(3) Assets and liabilities resulted by long-term account receivable transfer and continues involvement
Nil
Other explanation:
Nil
17. Long-term equity investment
Unit: RMB/CNY
Changes in the period (+, -)
Ending
Openin Investm Cash balance
Other Accrual Ending
The g ent dividen of
Additio compre of balance
investe balance Capital gains Other d or impair
nal hensive impair (Book
d entity (Book reducti recogni equity profit Other ment
investm income ment value)
value) on zed change announ provisi
ent adjustm provisi
under ced to on
ent on
equity issued
169
I. Joint venture
Shenzh
en
Emmell
10,379. 10,379.
e
73 73
Industri
al Co.,
Ltd.
Shenzh
en
Xinsen
Jewelry
19,950, 19,950,
Gold
000.00 000.00
Supply
Chain
Co.,
Ltd
Subtota 19,960, 19,960,
l 379.73 379.73
II. Associated enterprise
19,960, 19,960,
Total
379.73 379.73
Other explanation:
Nil
18. Investment in other equity instrument
Unit: RMB/CNY
Item Ending balance Opening balance
Itemized the non-tradable equity instrument investment in the period
Unit: RMB/CNY
Causes of those
that designated
Cause of
Retained measured by
retained
earnings fair value and
Dividend earnings
Cumulative Cumulative transfer from with its
Item income transfer from
gains losses other variation
recognized other
comprehensive reckoned into
comprehensive
income other
income
comprehensive
income
Other explanation:
Nil
19. Other non-current financial assets
Unit: RMB/CNY
Item Ending balance Opening balance
Other explanation:
170
Nil
20. Investment real estate
(1) Investment real estate measured at cost
□Applicable Not applicable
(2) Investment real estate measured at fair value
□Applicable Not applicable
(3) Investment real estate without property rights certificate
Unit: RMB/CNY
Reasons for failing to complete the
Item Book value
property rights certificate
Other explanation:
Nil
21. Fix assets
Unit: RMB/CNY
Item Ending balance Opening balance
Fix assets 2,304,402.38 3,439,212.00
Total 2,304,402.38 3,439,212.00
(1) Fix assets
Unit: RMB/CNY
Electronic
Houses and Machinery Means of
Item equipment and Total
buildings equipment transportation
others
I. Original book
value:
1.Opening
2,959,824.00 1,414,480.77 958,593.21 253,527.49 5,600,043.47
balance
2.Current
46,324.60 46,324.60
increased
(1)Purch
46,324.60 46,324.60
ase
(2)Const
ruction in progress
transfer-in
(3)The
increase in
business
combination
171
3.Current
218,803.42 218,803.42
decreased
(1)
218,803.42 218,803.42
Disposal or scrap
4.Ending
2,959,824.00 1,195,677.35 958,593.21 313,470.09 5,427,564.65
balance
II. Accumulated
depreciation
1.Opening
732,556.44 443,727.15 784,467.01 200,080.87 2,160,831.47
balance
2.Current
133,192.08 124,021.40 77,919.23 49,438.23 384,570.94
increased
(1)Accru
133,192.08 124,021.40 77,919.23 49,438.23 384,570.94
al
3.Current
151,845.89 151,845.89
decreased
(1)
151,845.89 151,845.89
Disposal or scrap
4.Ending
865,748.52 415,902.66 862,386.24 249,519.10 2,393,556.52
balance
III. Impairment
provision
1.Opening
balance
2.Current
729,605.75 729,605.75
increased
(1)Accru
729,605.75 729,605.75
al
3.Current
decreased
(1)
Disposal or scrap
4.Ending
729,605.75 729,605.75
balance
IV. Book value
1.Ending
2,094,075.48 50,168.94 96,206.97 63,950.99 2,304,402.38
book value
2.Opening
2,227,267.56 970,753.62 174,126.20 67,064.62 3,439,212.00
book value
(2) Fixed assets temporary idle
Unit: RMB/CNY
172
Original book Accumulated Impairment
Item Book value Note
value depreciation provision
Machinery
1,044,247.81 314,642.06 729,605.75
equipment
(3) Fixed assets leasing-out by operational lease
Unit: RMB/CNY
Item Ending book value
(4) Fixed assets without property rights certificate
Unit: RMB/CNY
Reasons for failing to complete the
Item Book value
property rights certificate
The six properties of Lianxin Garden 7-
20F with original value of 2,959,824.00
Yuan. The property purchasing refers to
the indemnificatory housing for
enterprise talent buying from Shenzhen
Housing and Construction Bureau of
Six properties in Lianxin Garden 2,094,075.48 Luohu District. According to the
agreement, the enterprise shall not
carrying any kind of property trading
with any units or individuals except the
government, and the company has no
property certification on the above
mentioned properties.
Other explanation:
Nil
(5) Fixed assets disposal
Unit: RMB/CNY
Item Ending balance Opening balance
Other explanation:
Nil
22. Construction in progress
Unit: RMB/CNY
Item Ending balance Opening balance
(1) Construction in progress
Unit: RMB/CNY
Item Ending balance Opening balance
173
Impairment Impairment
Book balance Book value Book balance Book value
provision provision
(2) Changes in significant construction in progress
Unit: RMB/CNY
includi
Accum
Fixed Propor ng: Interes
Other ulated
Openi Curren assets tion of interes t
decrea Ending amoun
project t capital
ng t transfe Progre t of Sourceof
Item Budget sed in balanc invest capital ization
balanc increas r-in in ss interes funds
the e ment ized rate of
e ed the t
Period in amoun the
capital
Period budget t of the year
ization
year
(3) Provision for impairment of construction in progress in the current period
Unit: RMB/CNY
Item Accrual in the period Reasons for accrual
Other explanation:
Nil
(4) Engineering materials
Unit: RMB/CNY
Ending balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Other explanation:
Nil
23. Productive biological asset
(1) Productive biological assets measured by cost
□Applicable Not applicable
(2) Productive biological assets measured by fair value
□Applicable Not applicable
24. Oil and gas asset
□Applicable Not applicable
174
25. Right-of-use assets
Unit: RMB/CNY
Item Houses and buildings Total
I. Original book value
1.Opening balance 3,051,512.28 3,051,512.28
2.Current increased
3.Current decreased 95,785.85 95,785.85
4.Ending balance 2,955,726.43 2,955,726.43
II. Accumulated depreciation
1.Opening balance 1,546,253.38 1,546,253.38
2.Current increased 1,235,536.34 1,235,536.34
(1)Accrual 1,235,536.34 1,235,536.34
3.Current decreased
(1) Disposal
4.Ending balance 2,781,789.72 2,781,789.72
III. Impairment provision
1.Opening balance
2.Current increased
(1)Accrual
3.Current decreased
(1) Disposal
4.Ending balance
IV. Book value
1.Ending book value 173,936.71 173,936.71
2.Opening book value 1,505,258.90 1,505,258.90
Other explanation:
Nil
26. Intangible assets
(1) Intangible assets
Unit: RMB/CNY
Non-patent
Item Land use right Patent Total
technology
I. Original book
value
1.Opening
175
balance
2.Current
increased
(1)Purch
ase
(2)
Internal R & D
(3)The
increase in
business
combination
3.Current
decreased
(1)
Disposal
4.Ending
balance
II. Accumulated
depreciation
1.Opening
balance
2.Current
increased
(1)Accru
al
3.Current
decreased
(1)
Disposal
4.Ending
balance
III. Impairment
provision
1.Opening
balance
2.Current
increased
(1)Accru
al
3.Current
decreased
(1)
Disposal
4.Ending
176
balance
IV. Book value
1.Ending
book value
2.Opening
book value
Ratio of intangible assets resulted from internal R&D in balance of intangible assets at period-end
(2) Land use right without certificate of title completed
Unit: RMB/CNY
Reasons for failing to complete the
Item Book value
property rights certificate
Other explanation:
Nil
27. Expense on research and development
Unit: RMB/CNY
Current increased Current decreased
Opening Recognized Transfer to Ending
Item Internal
balance as current balance
expense on Other
intangible profit and
R&D
assets loss
Total
Other explanation:
Nil
28. Goodwill
(1) Original book value of goodwill
Unit: RMB/CNY
Current increased Current decreased
The invested Opening Resulted by Ending balance
entity or items balance enterprise Dispose
combination
Total
(2) Goodwill Impairment provision
Unit: RMB/CNY
The invested Opening Current increased Current decreased Ending balance
177
entity or items balance Accrual Dispose
Total
Information about the asset group or asset group combination in which the goodwill is located
Nil
Explain the method of confirming the goodwill impairment test process, key parameters (such as the forecast period growth rate,
stable period growth rate, profit rate, discount rate, forecast period, etc. when estimating the present value of future cash flow), and
the impairment loss of goodwill:
Nil
Impact of impairment test for goodwill
Nil
Other explanation:
29. Long-term expenses to be apportioned
Unit: RMB/CNY
Amortized in the
Item Opening balance Current increased Other decrease Ending balance
Period
Other explanation:
Nil
30. Deferred income tax asset /Deferred income tax liabilities
(1) Deferred income tax assets without offset
Unit: RMB/CNY
Ending balance Opening balance
Item Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference asset difference asset
Bad debt provision 249,675.40 62,418.85 72,308.73 18,077.18
Provision for decline in
226,201.90 56,550.48 183,877.94 45,969.49
value of inventories
Total 475,877.30 118,969.33 256,186.67 64,046.67
(2) Deferred income tax liabilities without offset
Unit: RMB/CNY
Ending balance Opening balance
Item
Taxable temporary Deferred income tax Taxable temporary Deferred income tax
178
differences liabilities differences liabilities
(3) Deferred income tax assets and deferred income tax liabilities listed after off-set
Unit: RMB/CNY
Ending balance of Trade-off between the Opening balance of
Trade-off between the
deferred income tax deferred income tax deferred income tax
Item deferred income tax
assets or liabilities after assets and liabilities at assets or liabilities after
assets and liabilities
off-set period-begin off-set
Deferred income tax
118,969.33 64,046.67
asset
(4) Details of deferred income tax assets without recognized
Unit: RMB/CNY
Item Ending balance Opening balance
(5) Deductible losses of un-recognized deferred income tax assets expired on the followed year
Unit: RMB/CNY
Year Ending amount Opening amount Note
Other explanation:
Nil
31. Other non-current assets
Unit: RMB/CNY
Ending balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Advance
payment for 400,000.00 400,000.00 400,000.00 400,000.00
house
Total 400,000.00 400,000.00 400,000.00 400,000.00
Other explanation:
As of December 31, 2022, the Housing and Construction Bureau of Luohu District, Shenzhen City has not delivered houses for
enterprise talents in Luohu District.
32. Short-term loans
(1) Category
Unit: RMB/CNY
Item Ending balance Opening balance
Explanation on short-term loans category:
179
Nil
(2) Overdue outstanding short-term loans
Total 0.00 Yuan overdue outstanding short-term loans at period-end, including the followed significant amount:
Unit: RMB/CNY
Borrower Ending balance Lending rate Overdue time Overdue rate
Other explanation:
Nil
33. Trading financial liability
Unit: RMB/CNY
Item Ending balance Opening balance
Including:
Including:
Other explanation:
Nil
34. Derivative financial liability
Unit: RMB/CNY
Item Ending balance Opening balance
Other explanation:
Nil
35. Note payable
Unit: RMB/CNY
Category Ending balance Opening balance
Notes expired at period-end without paid was 0.00 Yuan.
36. Account payable
(1) Account payable
Unit: RMB/CNY
Item Ending balance Opening balance
Within one year(one year included) 1,914,595.55 7,347,161.83
1-2 years (2 years included) 12,683.17 48,424.51
2-3 years (3 years included) 48,424.51 410,259.07
3-4 years (4 years included) 410,259.07 487,016.93
180
4-5 years (5 years included) 487,016.93 1,240.00
Over 5 years 4,444.00 3,204.00
Total 2,877,423.23 8,297,306.34
(2) Important account payable with account age over one year
Unit: RMB/CNY
Reasons for non-reimbursement or carry-
Item Ending balance
forward
Other explanation:
There was no important account payable with account age over one year at end of the Period.
37. Accounts received in advance
(1) Accounts received in advance
Unit: RMB/CNY
Item Ending balance Opening balance
(2) Account received in advance with over one year book age
Unit: RMB/CNY
Reasons for non-reimbursement or carry-
Item Ending balance
forward
38. Contractual liability
Unit: RMB/CNY
Item Ending balance Opening balance
Receipt of goods in advance 791,762.84 124,328.07
Total 791,762.84 124,328.07
Book value has major changes in the period and causes
Unit: RMB/CNY
Amount
Item Reason for change
changes
39. Wage payable
(1) Wage payable
Unit: RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
I. Short-term
923,477.10 7,526,844.37 7,680,329.05 769,992.42
compensation
II. Post-employment
benefit-Defined 527,982.40 527,982.40
contribution plan
181
Total 923,477.10 8,054,826.77 8,208,311.45 769,992.42
(2) Short-term compensation
Unit: RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
1. Wages, bonus,
918,177.00 6,670,950.88 6,825,496.03 763,631.85
allowances and subsidy
2. Employee benefits 176,085.74 176,085.74
3. Social insurance 292,013.49 291,835.39 178.10
Including:
267,266.70 267,088.60 178.10
Medical insurance
Work
7,296.94 7,296.94
injury insurance
Maternity
17,449.85 17,449.85
insurance
4. Housing
323,412.84 323,412.84
accumulation fund
5. Labor union
expenditure and
5,300.10 64,381.42 63,499.05 6,182.47
personnel education
expense
Total 923,477.10 7,526,844.37 7,680,329.05 769,992.42
(3) Defined contribution plan
Unit: RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
1. Basic endowment
516,150.77 516,150.77
insurance
2. Unemployment
11,831.63 11,831.63
insurance
Total 527,982.40 527,982.40
Other explanation:
At the end of the period, there were no arrears in employee compensation.
40. Taxes payable
Unit: RMB/CNY
Item Ending balance Opening balance
Value added tax 33,374,610.42 826,399.46
Enterprise income tax 1,113,788.23 27,591.59
Individual income tax 29,149.60 19,002.77
City maintenance & construction tax 2,056,530.87 15,940.70
Stamp tax 101,516.08 11,223.31
Educational surcharge 1,468,913.16 11,348.69
Total 38,144,508.36 911,506.52
182
Other explanation:
41. Other account payable
Unit: RMB/CNY
Item Ending balance Opening balance
Other account payable 48,621,087.98 61,407,301.04
Total 48,621,087.98 61,407,301.04
(1) Interest payable
Unit: RMB/CNY
Item Ending balance Opening balance
Important interest overdue without paid:
Unit: RMB/CNY
Borrower Amount overdue Overdue reason
Other explanation:
Nil
(2) Dividend payable
Unit: RMB/CNY
Item Ending balance Opening balance
Other explanation:including dividends payable with over one year age and disclosure un-payment reasons
Nil
(3) Other account payable
1) By nature
Unit: RMB/CNY
Item Ending balance Opening balance
Custodian and common benefit debts 28,624,749.18 25,501,476.16
Warranty and guarantee money 1,781,940.00 10,756,806.00
Intercourse funds 16,500,000.00 23,328,000.00
Other payable service charge
801,237.73 624,528.30
(intermediary services included)
Collection and payment 669,657.66 648,626.35
Other 243,503.41 547,864.23
Total 48,621,087.98 61,407,301.04
2) Significant other payable with over one year age
Unit: RMB/CNY
183
Reasons for non-reimbursement or carry-
Item Ending balance
forward
Custodian and common benefit debts 28,624,749.18
Shenzhen Jianzhi Industrial
10,000,000.00 Pre-collection of cooperation deposit
Development Co., Ltd.
Total 38,624,749.18
Other explanation:
Note 1: “Intercourse funds ” at period-end includes 10,000,000.00 yuan, which is the cooperation deposit received in advance from
Shenzhen Jianzhi Industrial Development Co., Ltd that may need to be returned in the future;
Note 2: “Intercourse funds ” at period-end includes 6,500,000.00 yuan, which is the interest-free loan applied by subsidiary of the
Company Shenzhen Emmelle Industrial Co., Ltd to Shenzhen Guosheng Energy Investment Development Co., Ltd(the shareholder
of CBC) on November 1, 2010 to supplement the daily working capital.
42. Liability held for sale
Unit: RMB/CNY
Item Ending balance Opening balance
Other explanation:
Nil
43. Non-current liabilities due within one year
Unit: RMB/CNY
Item Ending balance Opening balance
Lease liabilities due within one year 210,892.38 1,456,782.04
Total 210,892.38 1,456,782.04
Other explanation:
Nil
44. Other current liabilities
Unit: RMB/CNY
Item Ending balance Opening balance
VAT received in advance 102,929.16 11,700.06
Total 102,929.16 11,700.06
Changes of short-term bond payable:
Unit: RMB/CNY
Premiu
Openin Accrual
Issued m/disco Paid in
Face Release Bond Issuing interest Ending
Bond g in the unt the
value date period amount by face balance
balance Period amortiz Period
value
ation
Total
184
Other explanation:
Nil
45. Long-term loans
(1)Category
Unit: RMB/CNY
Item Ending balance Opening balance
Explanation on category of long-term loans:
Nil
Other explanation:including interest rate section
46. Bonds payable
(1) Bonds payable
Unit: RMB/CNY
Item Ending balance Opening balance
(2) Changes of bonds payable (not including the other financial instrument of preferred stock and
perpetual capital securities that classify as financial liability)
Unit: RMB/CNY
Premiu
Openin Accrual
Issued m/disco Paid in
Face Release Bond Issuing interest Ending
Bond g in the unt the
value date period amount by face balance
balance Period amortiz Period
value
ation
Total ——
(3) Convertible conditions and time for shares transfer for the convertible bonds
Nil
(4) Other financial instruments classify as financial liability
Outstanding other financial instruments as preferred stock and perpetual bonds at period-end
Nil
Changes of the outstanding financial instruments as preferred stock and perpetual bonds at period-end
Unit: RMB/CNY
185
Outstandin Period-begin Current increased Current decreased Period-end
g financial
instrument Amount Book value Amount Book value Amount Book value Amount Book value
Basis for financial liability classification for other financial instrument
Nil
Other explanation:
Nil
47. Lease liability
Unit: RMB/CNY
Item Ending balance Opening balance
Lease Payments 215,367.24
Unrecognized financing charges 12,935.13
Total 228,302.37
Other explanation:
Nil
48. Long-term account payable
Unit: RMB/CNY
Item Ending balance Opening balance
(1) By nature
Unit: RMB/CNY
Item Ending balance Opening balance
Other explanation:
Nil
(2) Special payable
Unit: RMB/CNY
Item Opening balance Current increased Current decreased Ending balance Causes
Other explanation:
Nil
186
49. Long-term wages payable
(1) Long-term wages payable
Unit: RMB/CNY
Item Ending balance Opening balance
(2) Changes of defined benefit plans
Present value of the defined benefit plans:
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Scheme assets:
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Net liability (assets) of the defined benefit plans
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Content of defined benefit plans and relevant risks, impact on future cash flow of the Company as well as times and uncertainty:
Major actuarial assumption and sensitivity analysis:
Nil Nil
Other explanation:
Nil
50. Accrual liability
Unit: RMB/CNY
Item Ending balance Opening balance Causes
未决诉讼 887,342.00
Total 887,342.00
Other explanation, including relevant important assumptions and estimation:
51. Deferred income
Unit: RMB/CNY
Item Opening balance Current increased Current decreased Ending balance Causes
Item with government subsidy involved:
Unit: RMB/CNY
New grants Amount Amount Cost
Opening Other Ending Assets-
Liability in the reckoned in reckoned in reduction
balance changes balance related/inco
Period non- other in the
187
operation income period me related
revenue
Other explanation:
Nil
52. Other non-current liabilities
Unit: RMB/CNY
Item Ending balance Opening balance
Other explanation:
Nil
53. Share capital
Unit: RMB/CNY
Changes in the period (+, -)
Opening Shares Ending
balance New shares transferred balance
Bonus share Other Subtotal
issued from capital
reserve
551,347,947. 137,836,986. 137,836,986. 689,184,933.
Total shares
00 00 00 00
Other explanation:
54. Other equity instrument
(1) Outstanding other financial instruments as preferred stock and perpetual bonds at period-end
Nil
(2) Changes of the outstanding other financial instruments as preferred stock and perpetual bonds at period-end
Unit: RMB/CNY
Outstandin Period-begin Current increased Current decreased Period-end
g financial
instrument Amount Book value Amount Book value Amount Book value Amount Book value
Changes of other equity instrument, change reasons and relevant accounting treatment basis:
Nil
Other explanation:
Nil
188
55. Capital public reserve
Unit: RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Capital premium(Share
150,990,173.10 150,990,173.10
capital premium)
Other capital public
627,834,297.85 627,834,297.85
reserve
1.Debt restructuring
482,580,588.23 482,580,588.23
income
2.Other 145,253,709.62 145,253,709.62
Total 627,834,297.85 150,990,173.10 778,824,470.95
Other explanation:including changes and reasons for changes
Note: Among the “other capital public reserves” , 135,840,297.18 Yuan refers to the payment for creditor from shares assignment by
whole shareholders; majority shareholder Shenzhen Guosheng Energy Investment Development Co., Ltd. donated 5,390,399.74
Yuan.
56. Inventory shares
Unit: RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Other explanation:including changes and reasons for changes
Nil
57. Other comprehensive income
Unit: RMB/CNY
Current period incurred
Less: Less:
written in written in
other other
comprehen comprehen
sive sive Belong to Belong to
Opening Account income in income in Less: Ending
Item parent minority
balance before previous previous balance
Income tax
income tax period and period and company after shareholders
in the period carried carried expense
tax after tax
forward to forward to
gains and retained
losses in earnings in
current current
period period
Other explanation: including the active part of the hedging gains/losses of cash flow transfer to initial recognition adjustment for
the arbitraged items
Nil
189
58. Reasonable reserve
Unit: RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Other explanation:including changes and reasons for changes
Nil
59. Surplus public reserve
Unit: RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Statutory surplus
32,673,227.01 32,673,227.01
reserves
Total 32,673,227.01 32,673,227.01
Explanation: including changes and reasons for changes
60. Retained profit
Unit: RMB/CNY
Item Current period Prior period
Retained profit at period-end before
-1,202,936,933.70 -1,200,950,240.88
adjustment
Retained profit at period-begin after
-1,202,936,933.70 -1,200,950,240.88
adjustment
Add: net profit attributable to
shareholders of parent company for this -7,616,378.75 -1,986,692.82
year
Retained profit at period-end -1,210,553,312.45 -1,202,936,933.70
Adjustment for retained profit at period-begin:
1) Retroactive adjustment due to the Accounting Standards for Business Enterprise and relevant new regulations, retained profit at
period-begin has 0.00 Yuan affected;
2) Due to the accounting policy changes, retained profit at period-begin has 0.00 Yuan affected;
3) Due to the major accounting errors correction, retained profit at period-begin has 0.00 Yuan affected;
4) Consolidation range changed due to the same control, retained profit at period-begin has 0.00 Yuan affected;
5) Total other adjustment impacts 0.00 Yuan retained profit at period-begin
61. Operation revenue and operation cost
Unit: RMB/CNY
Current period incurred Prior period incurred
Item
Revenue Cost Revenue Cost
Main business 441,648,114.02 416,413,503.39 160,519,280.02 151,370,945.29
Other business 3,114,124.23 471,249.78 4,727,297.93 1,236,041.30
Total 444,762,238.25 416,884,753.17 165,246,577.95 152,606,986.59
190
Whether the lower of audited net profit before or after non-recurring gain/loss is negative
□Yes No
Revenue:
Unit: RMB/CNY
Contract type 1# Division 2# Division Total
Product type 166,051,582.65 278,795,336.38 444,846,919.03
Including:
Jewelry and gold 166,051,582.65 261,673,540.71 427,725,123.36
Lithium battery
material for bicycles 17,121,795.67 17,121,795.67
and other
Classification by
business area
Including:
Market or customer
type
Including:
Contract type
Including:
Classification by time
of goods transfer
Including:
Classification by
contract duration
Including:
Classification by sales
channel
Including:
Total 166,051,582.65 278,795,336.38 444,846,919.03
Information relating to performance obligation:
Nil
Information relating to the transaction price assigned to the remaining performance obligation:
The amount of revenue corresponding to performance obligation that have been signed but have not been fulfilled or have not been
fulfilled at the end of the period was 0.00 Yuan, including 0.00 Yuan is expected to be recognized as revenue in subsequent years,
0.00 Yuan is expected to be recognized as revenue in subsequent years, 0.00 Yuan is expected to be recognized as revenue in
subsequent years. Other explanation:
Nil
191
62. Tax and surcharge
Unit: RMB/CNY
Item Current period incurred Prior period incurred
City maintenance & construction tax 2,060,815.10 32,894.51
Educational surcharge 1,472,010.75 23,027.79
Stamp tax 225,148.85 58,446.51
Other 2,338.58
Total 3,757,974.70 116,707.39
Other explanation:
Nil
63. Sales expenses
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Employee compensation 1,354,906.96 1,543,121.27
Mall service fee 2,425,661.82
Marketing promotion fees 631,247.89 705,365.87
Business entertainment 360.00 76,402.59
Business travel expenses 344,559.08 163,858.29
Lease fee 16,130.04 28,050.01
Design fee 471,871.00 572,145.63
Depreciation and amortization 227,870.06 143,941.58
Other 215,650.83 71,071.06
Total 5,688,257.68 3,303,956.30
Other explanation:
Nil
64. Administrative expenses
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Employee compensation 3,304,419.89 2,299,457.43
Intermediary service fee 996,070.70 1,496,322.29
Daily administrative expenses 1,982,406.14 836,063.07
Depreciation and amortization 1,242,279.43 1,522,762.50
Total 7,525,176.16 6,154,605.29
Other explanation:
Nil
65. R&D expenses
Unit: RMB/CNY
Item Current period incurred Prior period incurred
192
Employee compensation and benefits 901,277.20 1,701,324.36
Depreciation and amortization 23,290.50 251,361.22
Other 84,512.00
Total 924,567.70 2,037,197.58
Other explanation:
Nil
66. Financial expenses
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Less:Interest income 272,353.25 127,249.64
Commission charge etc. 42,766.84 23,566.49
Other 33,239.03 114,323.26
Total -196,347.38 10,640.11
Other explanation:
Nil
67. Other income
Unit: RMB/CNY
Sources Current period incurred Prior period incurred
Government subsidy 142,981.96 397,876.20
Personal tax withholding fee 3,369.17 2,516.00
68. Investment income
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Other explanation:
Nil
69. Net exposure hedge gains
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Other explanation:
Nil
70. Income from change of fair value
Unit: RMB/CNY
Sources Current period incurred Prior period incurred
193
Other explanation:
Nil
71. Loss of credit impairment
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Bad debt loss of other account receivable -59,830.83 -49,753.03
Bad debt losses of accounts receivable -15,456,941.61 -2,349,227.58
Total -15,516,772.44 -2,398,980.61
Other explanation:
Nil
72. Impairment loss on assets
Unit: RMB/CNY
Item Current period incurred Prior period incurred
II. Loss of inventory falling price and
loss of contract performance cost -110,756.09 -99,941.65
impairment
V. Impairment loss of fixed asset -729,605.75
Total -840,361.84 -99,941.65
Other explanation:
Nil
73. Income from assets disposal
Unit: RMB/CNY
Sources Current period incurred Prior period incurred
Dispose income of fixed assets -16,957.53
74. Non-operating income
Unit: RMB/CNY
Amount reckoned in current
Item Current period incurred Prior period incurred
non-recurring gains/losses
Other 4,081,450.75 5,680,409.27
Total 4,081,450.75 5,680,409.27
Government subsidy reckoned into current gains/losses:
Unit: RMB/CNY
Subsidy
impact The special Assets-
Governmen Issuing Offering Amount in Amount in
Nature current subsidy related/inco
t subsidy subject causes the Period last period
gains/losse (Y/N) me-related
s (Y/N)
194
Other explanation:
The “Other” in Non-operating income mainly refers to the rental settlement income of 3,837,081.41 yuan with the administrator
and the compensation of 239,571.50 yuan for the renaming fee of the assets in escrow
75. Non-operating expense
Unit: RMB/CNY
Amount reckoned in current
Item Current period incurred Prior period incurred
non-recurring gains/losses
Litigation compensation,
liquidated damages and late 887,344.31 121,651.29
fees, etc.
Other 3,856,679.82 5,182,307.93
Total 4,744,024.13 5,303,959.22
Other explanation:
In the current period and prior period, the operation assets for assets to be disposed are not allocated by management, relevant
maintenance and management costs are paid by the revenue and loss compensation income from assets leasing (the assets to be
disposed), reckoned into non-operating expenditure
76. Income tax expense
(1) Income tax expense
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Current income tax expense 1,324,808.04 204,836.60
Deferred income tax expense -54,922.66 729,124.08
Total 1,269,885.38 933,960.68
(2) Adjustment on accounting profit and income tax expenses
Unit: RMB/CNY
Item Current period incurred
Total profit -6,712,457.84
Income tax measured by statutory/applicable tax rate -1,678,114.46
The impact of applying different tax rates to subsidiaries 2,297,168.02
Impact of adjusting the income tax of prior period -10,425.48
Impact on cost, expenses and losses that unable to deducted 223,824.06
The impact of deductible losses on the use of deferred income
-736,625.21
tax assets not recognized in prior period
The impact of deductible temporary differences or deductible
losses on deferred income tax assets not recognized in the 1,207,012.04
Period
Effect of recognized temporary differences on the difference
-32,953.59
between current tax rate and recognized deferred tax rate
Income tax expense 1,269,885.38
195
Other explanation:
Nil
77. Other comprehensive income
Refer to the Note
78. Items of cash flow statement
(1) Other cash received in relation to operation activities
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Interest, rent, utilities, etc. 2,518,300.99 3,776,439.39
Project cooperation payment 267,840.00
Deposits and guarantees received 146,354.32 6,282,000.00
Government subsidy and individual tax
400,016.00
handling fee refund
Employee correspondence 44,946.88
Other 6,871,962.41 10,463,236.95
Total 9,804,457.72 20,966,639.22
Explanation on other cash received in relation to operation activities:
Note: “Other” of prior period incurred including 10,145,161.80 yuan land buyback compensation of Shajing
(2) Other cash paid in relation to operation activities
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Expenses such as rent and property
3,837,081.41 3,642,689.57
management maintenance fees
Deposits and security deposits paid 8,001,780.56 6,057,078.82
Sales, management and R&D expenses 5,399,850.61 3,828,026.64
Litigation compensation, liquidated
damages and late fees, etc.
Handling expenses 42,766.84 23,566.49
Other 4,917,479.65 281,992.52
Total 22,198,959.07 13,833,354.04
Explanation on other cash paid in relation to operation activities:
Nil
(3) Other cash received from investment activities
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Explanation on other cash received from investment activities:
196
Nil
(4) Cash paid related with investment activities
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Explanation on cash paid related with investment activities
Nil
(5) Other cash received in relation to financing activities
Unit: RMB/CNY
Item Current period incurred Prior period incurred
9,000,000.00
Total 9,000,000.00
Explanation on other cash received in relation to financing activities:
Nil
(6)Other cash paid related with financing activities
Unit: RMB/CNY
Item Current period incurred Prior period incurred
20,207,638.62 2,296,062.44
Total 20,207,638.62 2,296,062.44
Explanation on other cash paid related with financing activities:
Nil
79. Supplementary information to statement of cash flow
(1) Supplementary information to statement of cash flow
Unit: RMB/CNY
Supplementary information Current amount Amount of the previous period
1．Net profit adjusted to cash flow of
operation activities:
Net profit -7,982,343.22 -1,639,556.00
Add: Assets impairment provision 16,357,134.28 2,498,922.26
Depreciation of fixed assets,
consumption of oil assets and 384,570.94 371,811.92
depreciation of productive biology assets
Depreciation of right-of-use
1,235,536.34 1,546,253.38
assets
Amortization of intangible
assets
Amortization of long-term
197
deferred expenses
Loss from disposal of fixed
assets, intangible assets and other long- 16,957.53
term assets (gain is listed with “-”)
Losses on scrapping of fixed
assets (gain is listed with “-”)
Gain/loss of fair value changes
(gain is listed with “-”)
Financial expenses (gain is
33,239.03 114,323.26
listed with “-”)
Investment loss (gain is listed
with “-”)
Decrease of deferred income tax
-54,922.66 729,124.08
asset (increase is listed with “-”)
Increase of deferred income tax
liability (decrease is listed with “-”)
Decrease of inventory (increase is
-40,069,049.13 -619,189.48
listed with “-”)
Decrease of operating receivable
-257,151,228.59 7,017,642.37
accounts (increase is listed with “-”)
Increase of operating payable
29,587,661.28 5,654,601.08
accounts (decrease is listed with “-”)
Other -3,776,621.83
Net cash flow arising from
-261,419,066.03 15,673,932.87
operating activities
2. Material investment and financing not
involved in cash flow
Conversion of debt into capital
Switching Company bonds due within
one year
Financing lease of fixed assets
3. Net change of cash and cash
equivalents:
Balance of cash at period end 50,922,869.35 33,246,957.92
Less: Balance of cash equivalent at
33,246,957.92 19,887,978.05
year-begin
Add: Balance at year-end of cash
equivalents
Less: Balance at year-begin of cash
equivalents
Net increased amount of cash and cash
17,675,911.43 13,358,979.87
equivalent
(2) Net cash paid for obtaining subsidiary in the Period
Unit: RMB/CNY
Amount
Including:
Including:
Including:
Other explanation:
Nil
198
(3) Net cash received by disposing subsidiary in the Period
Unit: RMB/CNY
Amount
Including:
Including:
Including:
Other explanation:
Nil
(4) Constitution of cash and cash equivalent
Unit: RMB/CNY
Item Ending balance Opening balance
I. Cash 50,922,869.35 33,246,957.92
Including: Cash on hand 33,531.25 27,587.25
Bank deposit available for
50,889,338.10 33,219,370.67
payment at any time
III. Balance of cash and cash equivalents
50,922,869.35 33,246,957.92
at the period -end
Including: Cash and cash equivalent that
has use restriction in parent company or 3,776,621.83
subsidiary of the Group
Other explanation:
80. Notes of changes of owners’ equity
Explain the name and adjusted amount in “Other” at end of last period:
81. Assets with ownership or use right restricted
Unit: RMB/CNY
Item Ending book value Restriction reasons
Monetary fund 3,776,621.83
Total 3,776,621.83
Other explanation:
Note 1: restriction found more in “Note VI- 1. Monetary fund”
199
82. Foreign currency monetary items
(1) Foreign currency monetary items
Unit: RMB/CNY
Ending foreign currency Ending RMB balance
Item Convert rate
balance converted
Monetary fund
Including: USD
EURO
HKD
Account receivable
Including: USD
EURO
HKD
Long-term loans
Including: USD
EURO
HKD
Other explanation:
Nil
(2) Explanation on foreign operational entity, including as for the major foreign operational entity,
disclosed main operation place, book-keeping currency and basis for selection; if the book-keeping
currency changed, explain reasons
□Applicable Not applicable
83. Hedging
Disclosed hedging items and relevant hedging instrument based on hedging’s category, disclosed qualitative and quantitative
information for the arbitrage risks:
84. Government subsidy
(1) Government subsidy
Unit: RMB/CNY
Amount reckoned into current
Category Amount Item
gains/losses
(2) Government subsidy rebate
□Applicable Not applicable
200
Other explanation:
Nil
85. Other
Nil
VIII. Changes of consolidation scope
1. Enterprise combined under different control
(1) Enterprise combined under different control in the Period
Unit: RMB/CNY
Income of Net profit
Standard to
Acquired acquiree of acquiree
Time point Cost of Ratio of determine
way Equity Purchasing from from
Acquiree for equity equity equity the
obtained date purchasing purchasing
obtained obtained obtained purchasing
way date to date to
date
period-end period-end
Other explanation:
There was no change in the scope of consolidation during the reporting period.
(2) Combination cost and goodwill
Unit: RMB/CNY
Consolidation cost
--Cash
--Fair value of non-cash assets
--Fair value of debts issued or assumed
--Fair value of equity securities issued
-- Fair value of contingent consideration
--Fair value of the equity prior to the purchasing date
--Other
Total combination cost
Less: shares of fair value of identifiable net assets acquired
The amount by which the goodwill/cost of consolidation is less
than the share of fair value of identifiable net assets acquired
Determination method for fair value of the combination cost and contingent consideration and changes:
Main reasons for large goodwill resulted:
Other explanation:
(3) Identifiable assets and liability on purchasing date under the acquiree
Unit: RMB/CNY
201
Fair value on purchasing date Book value on purchasing date
Assets:
Monetary fund
Account receivable
Inventory
Fix assets
Intangible assets
Liability:
Loan
Account payable
Deferred income tax liabilities
Net assets
Less: Minority interests
Net assets acquired
Determination method for fair value of the identifiable assets and liabilities:
Contingent liability of the acquiree bear during combination:
Other explanation:
(4) Gains or losses arising from re-measured by fair value for the equity held before purchasing date
Whether it is a business combination realized by two or more transactions of exchange and a transaction of obtained control rights
in the Period or not
□Yes No
(5) On purchasing date or period-end of the combination, combination consideration or fair value of identifiable assets and
liability for the acquiree are un-able to confirm rationally
(6)Other explanation
2. Enterprise combine under the same control
(1) Enterprise combined under the same control in the Period
Unit: RMB/CNY
202
Income of Net profit
the of the
Income of Net profit
combined combined
Equity ratio Basis of Standard to the of the
party from party from
combined determine combined combined
Combined obtained in Combinatio period- period-
under the the party party
party combinatio n date begin of begin of
same combinatio during the during the
n combinatio combinatio
control n date comparison comparison
n to the n to the
period period
combinatio combinatio
n date n date
Other explanation:
(2) Combination cost
Unit: RMB/CNY
Consolidation cost
--Cash
-- Book value of non-cash assets
- Book value of debts issued or assumed
-- The face value of the equity securities issued
--Contingent consideration
Explanation on contingent consideration and its changes:
Other explanation:
(3) Book value of the assets and liability of the combined party on combination date
Unit: RMB/CNY
Consolidation date End of last period
Assets:
Monetary fund
Account receivable
Inventory
Fix assets
Intangible assets
Liability:
Loan
Account payable
Net assets
Less: Minority interests
Net assets acquired
Contingent liability of the combined party bear during combination:
203
Other explanation:
3. Counter purchase
Basic transaction information, basis of counter purchase, whether making up business due to the assets and liability reserved by
listed company and basis, determination of combination cost, amount and calculation on adjusted equity by equity transaction:
4. Subsidiary disposal
Whether lost controlling rights while dispose subsidiary on one time or not
□Yes No
Whether lost controlling rights in the Period while dispose subsidiary on two or more steps or not
□Yes No
5. Other reasons for consolidation range changed
Reasons for changed on consolidation range (such as new subsidiary established, subsidiary liquidated etc.)And relevant
information:
6. Other
IX. Equity in other entity
1. Equity in subsidiary
(1) Constitute of enterprise group
Main operation Registered Share-holding ratio
Subsidiary Business nature Acquired way
place place Directly Indirectly
Shenzhen
Distribution of
Emmelle
Shenzhen Shenzhen bicycles and 70.00% Investment
Industrial Co.,
spare parts
Ltd.
Shenzhen Sales of
Xinsen Jewelry Jewelry,
Shenzhen Shenzhen 65.00% Investment
Gold Supply diamonds and
Chain Co., Ltd gold
Shenzhen Software and
Emmelle Cloud information
Shenzhen Shenzhen 49.00% Investment
Technology technology
Co., Ltd. service sales
Explanation on share-holding ratio in subsidiary different from ratio of voting right:
204
Nil
Basis for controlling the invested entity with half or below voting rights held and without controlling invested entity but with over
half and over voting rights:
Subsidiary of the Company-Shenzhen Emmelle Industry Co., Ltd. (with 70% equity held by the Company) holds 70% equity of
Shenzhen Emmelle Cloud Technology Co., Ltd
Controlling basis for the structuring entity included in consolidated range:
Nil
Basis on determining to be an agent or consignor:
Nil
Other explanation:
Nil
(2) Important non-wholly-owned subsidiary
Unit: RMB/CNY
Gains/losses Dividend announced to
Share-holding ratio of Ending equity of
Subsidiary attributable to minority distribute for minority
minority minority
in the Period in the Period
Shenzhen Xinsen
Jewelry Gold Supply 35.00% 892,843.30 14,186,018.34
Chain Co., Ltd
Explanation on share-holding ratio of minority different from ratio of voting right:
Other explanation:
(3) Main finance of the important non-wholly-owned subsidiary
Unit: RMB/CNY
Ending balance Opening balance
Subsid Curren Non- Curren Non-
Non- Total Non- Total
iary Curren Total t current Curren Total t current
current liabiliti current liabiliti
t assets assets liabiliti liabiliti t assets assets liabiliti liabiliti
assets es assets es
es es es es
Shenz
hen
Xinsen
Jewelr 43,90 44,05 4,649 4,649 45,48 46,44 9,533 9,572
153,7 953,3 38,95
y Gold 4,659 8,456 ,218. ,218. 8,730 2,081 ,180. ,137.
97.14 51.29 7.32
Supply .26 .40 79 79 .47 .76 01 33
Chain
Co.,
Ltd
Unit: RMB/CNY
Current period incurred Prior period incurred
Subsidiary
Operation Net profit Total Cash flow Operation Net profit Total Cash flow
205
revenue comprehen from revenue comprehen from
sive operation sive operation
income activity income activity
Shenzhen
Xinsen
Jewelry -
456,655,37 2,550,980.8 2,550,980.8 132,915,43 2,454,072.5 2,454,072.5 6,581,755.6
Gold 6,632,446.2
0.37 6 6 5.90 0 0 1
Supply 8
Chain Co.,
Ltd
Other explanation:
Nil
(4) Major restriction on using corporate assets and liquidate corporate debts
Nil
(5) Financial or other supporting provided to structuring entity that included in consolidated financial
statement
Nil
Other explanation:
Nil
2. Transaction that has owners equity shares changed in subsidiary but still with controlling rights
(1) Owners equity shares changed in subsidiary
Nil
(2) Impact on minority’s interest and owners’ equity attributable to parent company
Unit: RMB/CNY
Purchase cost/disposal consideration
--Cash
--Fair value of non-cash assets
Purchase cost/total disposal consideration
Less: Subsidiary's share of net assets calculated based on the
proportion of acquired/disposed equity
Difference
Including: Adjust capital public reserve
Adjust surplus public reserve
Adjusted retained profit
Other explanation:
206
Nil
3. Equity in joint venture and associated enterprise
(1) Important joint venture or associated enterprise
Joint venture or Share-holding ratio
Main operation Registered Accounting
associated Business nature
place place Directly Indirectly treatment
enterprise
Share-holding ratio or shares enjoyed different from voting right ratio:
Nil
Basis of the voting rights with 20% below but with major influence, or without major influence but with over 20% (20% included)
voting rights hold:
Nil
(2) Main financial information of the important joint venture
Unit: RMB/CNY
Ending balance/Current period incurred Opening balance/Prior period incurred
Current assets
Including: cash and cash equivalent
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Minority interests
Shareholders' equity attributable to the
parent company
Share of net assets calculated by
shareholding ratio
Adjustment items
--Goodwill
--Unrealized profit of internal trading
--Other
Book value of equity investment in joint
venture
Fair value of the equity investment of
joint ventures with public offers
concerned
Operation revenue
Financial expenses
Income tax expense
Net profit
207
Net profit of discontinuing operation
Other comprehensive income
Total comprehensive income
Dividends received from joint venture in
the year
Other explanation:
Nil
(3) Main financial information of the important associated enterprise
Unit: RMB/CNY
Ending balance/Current period incurred Opening balance/Prior period incurred
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Minority interests
Equity attributable to shareholder of
parent company
Share of net assets measured by
shareholding
Adjustment
--Goodwill
--Unrealized profit of internal trading
--Other
Book value of equity investment in
associated enterprise
Fair value of the equity investment of
associated enterprise with public offers
concerned
Operation revenue
Net profit
Net profit of discontinuing operation
Other comprehensive income
Total comprehensive income
Dividends received from associated
enterprise in the year
Other explanation:
Nil
208
(4) Financial summary for un-important joint venture or associated enterprise
Unit: RMB/CNY
Ending balance/Current period incurred Opening balance/Prior period incurred
Joint venture：
Total numbers measured by share-
holding ratio
Associated enterprise：
Total numbers measured by share-
holding ratio
Other explanation:
Nil
(5) Assets transfer ability has major restriction from joint venture or associated enterprise
Nil
(6) Excess losses from joint venture or associated enterprise
Unit: RMB/CNY
Un-confirmed losses not
Joint venture or associated Cumulative un-confirmed recognized in the Period (or Cumulative un-confirmed
enterprise losses net profit enjoyed in the losses at period-end
Period)
Other explanation:
Nil
(7) Un-confirmed commitment with investment concerned with joint venture
Nil
(8) Contingent liability with investment concerned with joint venture or associated enterprise
Nil
4. Co-runs operation
Main operation Share-holding ratio/share enjoyed
Name Registered place Business nature
place Directly Indirectly
Share-holding ratio or shares enjoyed different from voting right ratio:
Nil
If the co-runs entity is the separate entity, basis of the co-runs classification
Nil
209
Other explanation:
5. Equity in structuring entity that excluding in the consolidated financial statement
Relevant explanation
Nil
6. Other
Nil
X. Risks Related to Financial Instruments
XI. Disclosure of fair value
1. Ending fair value of the assets and liabilities measured by fair value
Unit: RMB/CNY
Ending fair value
Item
First-order Second-order Third-order Total
I. Sustaining measured
-- -- -- --
by fair value
II. Non-sustaining
-- -- -- --
measured by fair value
2. Recognized basis for the market price sustaining and non-persistent measured by fair value on first-
order
The quoted prices without adjustment in the active markets for identical assets or liabilities that are available at
the measurement date.
3. Valuation technique and qualitative and quantitative information on major parameters for the fair
value measure sustaining and non-persistent on second-order
The inputs for second-order are inputs other than first-order for which the related assets or liabilities are directly
or indirectly observable
210
4. Valuation technique and qualitative and quantitative information on major parameters for the fair
value measure sustaining and non-persistent on third-order
The third-order inputs are unobservable inputs for the underlying assets or liabilities. The fair value of the bank
acceptance bill receivable from bank is determined using the face amount because the probability of loss is
small and the recoverable amount is basically determined
5. Adjustment information and sensitivity analysis of unobservable parameters for the fair value measure
sustaining and non-persistent on third-order
Nil
6. Sustaining items measured by fair value, as for the conversion between at all levels, reasons for
conversion and policy for conversion time point
Nil
7. Changes of valuation technique in the Period
Nil
8. Financial assets and liability not measured by fair value
Nil
9. Other
XII. Related party and related transactions
1. Parent company
Share-holding
ratio on the Voting right ratio
Parent company Registered place Business nature Registered capital
enterprise for on the enterprise
parent company
General business:
Wansheng investment in
Industrial establishment of
Holdings Shenzhen industrial (specific 500 million Yuan 20.00% 20.00%
(Shenzhen) Co., items are
Ltd. separately
declared)
Explanation on parent company of the enterprise
211
Ultimate controller of the Company:
Other explanation:
2. Subsidiary of the Enterprise
Found more in Note VIII-1
3. Associated enterprise and joint venture
Found more in Note
Other associated enterprise and joint venture that have related transaction with the Company in the Period or occurred in previous
period
Joint venture or associated enterprise Relationship with the Company
Other explanation:
Nil
4. Other related party
Other related party Relationship with the Company
Shenzhen Zuankinson Jewelry Gold Supply Chain Co., Ltd. Shareholder of the subsidiary Xinsen Jewelry
The enterprise under the effective control of Chen Xuejin, wifu
Fuzhou Rongrun Jewelry Co., Ltd. of Chen Junrong, the shareholder of Shenzhen Zuankinson
Jewelry Gold Supply Chain Co., Ltd.
100% equity held by Shenzhen Zuankinson Jewelry Gold
Fuzhou Zuankinson Jewelry Co., Ltd.
Supply Chain Co., Ltd.
The enterprise with 30% equity held by actual controller Wang
Shenzhen Chanjuan Jewelry Co., Ltd.
Shenghong
Other explanation:
5. Related transaction
(1) Goods purchasing, labor service providing and receiving
Goods purchasing/labor service receiving
Unit: RMB/CNY
Whether more than
Transaction Current period Approved Prior period
Related party the transaction
content incurred transaction amount incurred
amount
Shenzhen
Chanjuan Jewelry Goods purchasing 166,608.44
Co., Ltd.
Goods sold/labor service providing
Unit: RMB/CNY
212
Related party Transaction content Current period incurred Prior period incurred
Fuzhou Rongrun Jewelry Co.,
Sales of goods 96,810,724.96 50,175,247.88
Ltd.
Fuzhou Zuankinson Jewelry
Sales of goods 23,137,699.12
Co., Ltd.
Explanation on goods purchasing, labor service providing and receiving
Nil
(2) Related trusteeship/contract and delegated administration/outsourcing
Trusteeship/contract
Unit: RMB/CNY
Client/ Entrusting Income from
Yield pricing
contract-out party/ Assets type Starting date Maturity date trusteeship/cont
basis
party contractor ract
Explanation on related trusteeship/contract
Nil
Delegated administration/outsourcing
Unit: RMB/CNY
Pricing basis of Trustee
Client/ Entrusting
trustee fee/outsourcing
contract-out party/ Assets type Starting date Maturity date
fee/outsourcing fee recognized
party contractor
fee in the Period
Explanation on related administration/outsourcing
Nil
(3) Related lease
As a lessor for the Company::
Unit: RMB/CNY
Lease income recognized in Lease income recognized in
Lessee Assets type
the Period prior Period
As a lessee for the Company:
Unit: RMB/CNY
rental cost for
Variable lease
short-term leases
payment not
and low-value Interest expenses
included in the Right-of-use assets
assets leases with Rental paid assumed on lease
measurement of increased
Assets simplified liability
Lessor leasing liability (if
type processing (if
applicable)
applicable)
Current Prior Current Prior Current Prior Current Prior Current Prior
period period period period period period period period period period
incurre incurre incurre incurre incurre incurre incurre incurre incurre incurre
213
d d d d d d d d d d
Explanation on related lease
Nil
(4) Related guarantee
As a guarantor for the Company
Unit: RMB/CNY
Guarantee completed
Secured party Amount guarantee Starting date Due date
(Y/N)
As a secured party for the Company
Unit: RMB/CNY
Guarantee completed
Guarantor Amount guarantee Starting date Due date
(Y/N)
Explanation on related guarantee
Nil
(5) Borrowed funds of related party
Unit: RMB/CNY
Related party Borrowed funds Starting date Due date Note
Borrowing
Lending
(6) Assets transfer and debt restructuring of related party
Unit: RMB/CNY
Related party Transaction content Current period incurred Prior period incurred
(7) Remuneration of key manager
Unit: RMB/CNY
Item Current period incurred Prior period incurred
Remuneration of key manager 1,417,895.39 1,457,847.63
(8) Other related transactions
Nil
214
6. Receivable/payable items of related parties
(1) Receivable item
Unit: RMB/CNY
Ending balance Opening balance
Item Related party
Book balance Bad debt provision Book balance Bad debt provision
Account Fuzhou Rongrun
44,987,445.10 4,146,308.99
receivable Jewelry Co., Ltd.
Fuzhou
Account
Zuankinson 19,085,600.00
receivable
Jewelry Co., Ltd.
(2) Payable item
Unit: RMB/CNY
Item Related party Ending book balance Opening book balance
Shenzhen Guosheng Energy
Other account payable Investment Development Co., 6,500,000.00 6,500,000.00
Ltd.
Shenzhen Chanjuan Jewelry
Account payable 144,642.53 33,699.49
Co., Ltd.
7. Commitments of related party
Nil
8. Other
Nil
XIII. Share-based payment
1. General share-based payment
□Applicable Not applicable
2. Share-based payment settled by equity
□Applicable Not applicable
3. Share-based payment settled by cash
□Applicable Not applicable
4. Revised and termination on share-based payment
Nil
215
5. Other
Nil
XIV. Commitment or contingency
1. Important commitments
Important commitments in balance sheet date
Nil
2. Contingency
(1) Contingency on balance sheet date
Nil
(2) For the important contingency not necessary to disclosed by the Company, explained reasons
The Company has no important contingency that need to disclosed
3. Other
Nil
XV. Events after balance sheet date
1. Important non-adjustment items
Unit: RMB/CNY
Impact on financial status and Reasons on un-able to
Item Content
operation results estimated the impact number
2. Profit distribution
Unit: RMB/CNY
3. Sales return
Nil
4. Other events after balance sheet date
Nil
216
XVI. Other important events
1. Previous accounting errors collection
(1) Retrospective restatement
Unit: RMB/CNY
Impact items of statement
Correction content Treatment procedures Cumulative impacted number
during a comparison
(2) Prospective application
Reasons for prospective application
Correction content Approval procedures
adopted
2. Debt restructuring
Nil
3. Assets replacement
(1) Non-monetary assets change
Nil
(2) Other assets replacement
Nil
4. Pension plan
Nil
5. Discontinued operations
Unit: RMB/CNY
Discontinued
operations
Income tax profit
Item Revenue Expenses Total profit Net profit
expense attributable to
owners of
parent company
Other explanation:
Nil
217
6. Segment
(1) Recognition basis and accounting policy for reportable segment
Nil
(2) Financial information for reportable segment
Unit: RMB/CNY
Item Offset between segments Total
(3) The Company has no reportable segments, or unable to disclose total assets and total liability for
reportable segments, explain reasons
Nil
(4)Other explanation
Nil
7. Major transaction and events makes influence on investor’s decision
Nil
8. Other
Nil
XVII. Principle notes of financial statements of parent company
1. Account receivable
(1)Category
Unit: RMB/CNY
Ending balance Opening balance
Categor Book balance Bad debt provision Book balance Bad debt provision
y Book Book
Accrual value Accrual value
Amount Ratio Amount Amount Ratio Amount
ratio ratio
Account
receivab
le with
bad debt 19,829,0 15,489,4 4,339,69 21,655,8 4,990,68 16,665,1
8.63% 78.11% 77.75% 64.16%
provisio 97.29 02.18 5.11 72.02 2.02 90.00
n accrual
by single
basis
218
Includ
ing:
Account
s with
single
significa
nt
amount
but with 15,780,1 12,624,1 3,156,03 18,925,6 3,785,13 15,140,5
6.87% 80.00% 67.95% 20.00%
bad 56.69 25.35 1.34 66.88 3.38 33.50
debts
provisio
n
accrued
individu
ally
Account
s with
single
minor
amount
but with
4,048,94 2,865,27 1,183,66 2,730,20 1,205,54 1,524,65
bad 1.76% 70.77% 9.80% 44.16%
0.60 6.83 3.77 5.14 8.64 6.50
debts
provisio
n
accrued
individu
ally
Account
receivab
le with
bad debt 210,053, 630,160. 209,423, 6,195,91 18,587.7 6,177,32
91.37% 0.30% 22.25% 0.30%
provisio 360.30 08 200.22 1.60 4 3.86
n accrual
by
portfolio
Includ
ing:
Account
receivab
le
withdra
wal bad
debt
provisio
n by 210,053, 630,160. 209,423, 6,195,91 18,587.7 6,177,32
91.37% 0.30% 22.25% 0.30%
group of 360.30 08 200.22 1.60 4 3.86
credit
risk
characte
ristics
(Aging
analysis
method)
219
229,882, 16,119,5 213,762, 27,851,7 5,009,26 22,842,5
Total 100.00% 70.01% 100.00% 17.99%
457.59 62.26 895.33 83.62 9.76 13.86
Bad debt provision accrual on single basis:Accounts with single significant amount but with bad debts provision accrued
individually
Unit: RMB/CNY
Ending balance
Name
Book balance Bad debt provision Accrual ratio Reason for accrual
该客户已停工停产，
Guangshui Jiaxu
预计收回难度大，公
Energy Technology 15,780,156.69 12,624,125.35 80.00%
司已对该客户进行起
Co., Ltd.
诉。
Total 15,780,156.69 12,624,125.35
Bad debt provision accrual on single basis:Accounts with single minor amount but with bad debts provision accrued individually
Unit: RMB/CNY
Ending balance
Name
Book balance Bad debt provision Accrual ratio Reason for accrual
Shenzhen Emmelle 合并内 Related party
933,191.88
Industrial Co., Ltd. 不 Accrual 坏账
Suzhou Jiaxin
Economic Trade Co., 888,757.00 888,757.00 100.00% 预计收回难度大
Ltd.
Dongguan Daxiang
676,734.00 676,734.00 100.00% 预计收回难度大
New Energy Co., Ltd.
Suzhou Daming
Vehicle Industry Co., 649,688.00 519,750.40 80.00% 预计收回难度大
Ltd.
Guangdong Xinlingjia
348,136.00 348,136.00 100.00% 预计收回难度大
New Energy Co., Ltd.
Hubei Topsdun
Eletronic Tech. Co., 241,068.58 120,534.29 50.00% 预计收回难度大
Ltd.
Tianjin Huihui Electric
116,840.14 116,840.14 100.00% 预计收回难度大
Vehicle Co., Ltd.
Other 194,525.00 194,525.00 100.00% 预计收回难度大
Total 4,048,940.60 2,865,276.83
Bad debt provision accrual on portfolio:Accounts receivable with provision for bad debts by aging analysis method
Unit: RMB/CNY
Ending balance
Name
Book balance Bad debt provision Accrual ratio
Within one year(one year
210,053,360.30 630,160.08 0.30%
included)
Total 210,053,360.30 630,160.08
Explanation on portfolio basis:
If the provision for bad debts of account receivable is made in accordance with the general model of expected credit losses, please
refer to the disclosure of other account receivable to disclose related information about bad-debt provisions:
□Applicable Not applicable
By account age
Unit: RMB/CNY
220
Account age Book balance
Within one year(one year included) 229,882,457.59
Total 229,882,457.59
(2) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
Unit: RMB/CNY
Current changes
Opening
Category Collected or Ending balance
balance Accrual Write off Other
reversal
Accrual of bad
debt provision
for account 11,110,292.50
receivable in
the Period
Total 11,110,292.50
Including important amount of bad debt provision collected or reversal in the period:
Unit: RMB/CNY
Enterprise Amount collected or reversal Collection way
(3) Account receivables actually write-off during the reporting period
Unit: RMB/CNY
Item Amount written off
Including major account receivables write-off:
Unit: RMB/CNY
Amount cause by
Amount written related
Enterprise Nature Causes Procedure
off transactions or not
(Y/N)
Explanation on account receivable write-off:
Nil
(4) Top five account receivables collected by arrears party at ending balance
Unit: RMB/CNY
Proportion of total closing
Ending balance of accounts Ending balance of bad bet
Enterprise balance of accounts
receivable provision
receivable
Shenzhen Yunshang Jewelry
52,165,655.00 22.69% 156,496.97
Co., Ltd.
Shenzhen Hualinglong
Jewelry Culture Tech. Co., 37,514,073.30 16.32% 112,542.22
Ltd.
Fuzhou Rongrun Jewelry Co.,
32,393,000.00 14.09% 97,179.00
Ltd.
221
Fuzhou Cangshan Dingjue
25,756,505.00 11.20% 77,269.52
Jewelry Firm
Fuzhou Zuankinson Jewelry
19,085,600.00 8.30% 57,256.80
Co., Ltd.
Total 166,914,833.30 72.61%
(5) Assets and liability resulted by account receivable transfer and continuous involvement
Nil
Other explanation:
Nil
(6) Account receivable derecognition due to transfer of financial assets
Nil
2. Other account receivable
Unit: RMB/CNY
Item Ending balance Opening balance
Other account receivable 209,606.79 70,451.01
Total 209,606.79 70,451.01
(1) Interest receivable
1) Category
Unit: RMB/CNY
Item Ending balance Opening balance
2) Important overdue interest
Unit: RMB/CNY
Impairment (Y/N) and
Borrower Ending balance Overdue time Overdue reason
judgment basis
Other explanation:
Nil
3) Accrual of bad debt provision
□Applicable Not applicable
222
(2) Dividend receivable
1) Category
Unit: RMB/CNY
Item (or the invested entity) Ending balance Opening balance
2) Important dividend receivable with over one year aged
Unit: RMB/CNY
Item (or the invested Causes of failure for Impairment (Y/N) and
Ending balance Account age
entity) collection judgment basis
3) Accrual of bad debt provision
□Applicable Not applicable
Other explanation:
Nil
(3) Other account receivable
1) By nature
Unit: RMB/CNY
Nature Ending book balance Opening book balance
Deposit or margin 70,963.00 70,963.00
Payment for equipment 11,400.00 11,400.00
Reserves 20,198.00 200.00
Other 119,576.50
Total 222,137.50 82,563.00
2) Accrual of bad debt provision
Unit: RMB/CNY
Phase I Phase II Phase III
Expected credit losses Expected credit losses
Bad debt provision Expected credit losses for the entire duration for the entire duration Total
over next 12 months (without credit (with credit impairment
impairment occurred) occurred)
Balance on January 1,
12,111.99 12,111.99
2022
January 1, 2022
balance in the current
period
Accrual in the Period 418.72 418.72
Balance on December
12,530.71 12,530.71
31, 2022
Change of book balance of loss provision with amount has major changes in the period
223
□Applicable Not applicable
By account age
Unit: RMB/CNY
Account age Book balance
Within one year(one year included) 139,574.50
2-3 years 70,663.00
Over 3 years 11,900.00
Over 5 years 11,900.00
Total 222,137.50
3) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
Unit: RMB/CNY
Current changes
Opening
Category Collected or Ending balance
balance Accrual Write off Other
reversal
Accrual of bad
debt provision
for other
12,111.99 418.72 12,530.71
account
receivable in
the Period
Total 12,111.99 418.72 12,530.71
Important amount of bad debt provision switch-back or collection in the period:
Unit: RMB/CNY
Enterprise Amount switch-back or collection Collection way
4) Other account receivables actually write-off during the reporting period
Unit: RMB/CNY
Item Amount written off
Including major other account receivables write-off:
Unit: RMB/CNY
Amount cause by
Amount written related
Enterprise Other Nature Causes Procedure
off transactions or not
(Y/N)
Other Explanation on account receivable write-off:
Nil
224
5) Top 5 other account receivable collected by arrears party at ending balance
Unit: RMB/CNY
Proportion in total
other account Ending balance of
Enterprise Nature Ending balance Account age
receivables at bad bet provision
period-end
Shenye Pengji
Deposit or margin 60,222.00 1-2 years 27.11% 180.67
(Group) Co., Ltd.
Huang Zeqi Reserves 19,998.00 1-2 years 9.00% 59.99
Shenzhen
Hongkang
Payment for
Instrument 11,400.00 Over 5 years 5.13% 11,400.00
equipment
Technology Co.,
Ltd.
Shenzhen Pengji
Property
Deposit or margin 10,441.00 1-2 years 4.70% 31.32
Management
Service Co., Ltd.
Shenzhen Color
Life Property
Management Co., Deposit or margin 300.00 Over 5 years 0.14% 300.00
Ltd. Lianxin Home
Branch
Total 102,361.00 46.08% 11,971.98
6) Account receivable with government subsidy involved
Unit: RMB/CNY
Time, amount and
Enterprise Government subsidy Ending balance Ending account age basis of amount
collection estimated
Nil
7)Other account receivable derecognition due to financial assets transfer
Nil
8) Assets and liability resulted by other account receivable transfer and continuous involvement
Nil
Other explanation:
Nil
3. Long-term equity investment
Unit: RMB/CNY
Item Ending balance Opening balance
225
Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Investment for
19,960,379.73 19,960,379.73 19,960,379.73 19,960,379.73
subsidiary
Total 19,960,379.73 19,960,379.73 19,960,379.73 19,960,379.73
(1) Investment for subsidiary
Unit: RMB/CNY
Changes in the period (+, -) Ending
Opening Ending
The invested Accrual of balance of
balance(Boo Additional Capital balance(Boo
entity impairment Other impairment
k value) investment reduction k value)
provision provision
Shenzhen
Emmelle
10,379.73 10,379.73
Industrial
Co., Ltd.
Shenzhen
Xinsen
19,950,000.0 19,950,000.0
Jewelry Gold
0 0
Supply Chain
Co., Ltd
19,960,379.7 19,960,379.7
Total
3 3
(2) Investment for associates and joint venture
Unit: RMB/CNY
Changes in the period (+, -)
Ending
Openin Investm Cash balance
Other Accrual Ending
Funded g ent dividen of
Additio compre of balance
enterpri balance Capital gains Other d or impair
nal hensive impair (Book
se (Book reducti recogni equity profit Other ment
investm income ment value)
value) on zed change announ provisi
ent adjustm provisi
under ced to on
ent on
equity issued
I. Joint venture
II. Associated enterprise
(3) Other explanation
Nil
4. Operation revenue and operation cost
Unit: RMB/CNY
Current period incurred Prior period incurred
Item
Revenue Cost Revenue Cost
Main business 266,611,588.18 253,367,696.62 23,505,830.29 23,100,454.32
Other business 568,558.49 120,538.07 4,693,393.21 1,232,802.37
226
Total 267,180,146.67 253,488,234.69 28,199,223.50 24,333,256.69
Revenue:
Unit: RMB/CNY
Contract type 1# Division 2# Division Total
Product type
Including:
Gold jewelry 261,673,540.71 261,673,540.71
Lithium battery
material for bicycles 630,341.33 630,341.33
and other
Classification by
business area
Including:
Market or customer
type
Including:
Contract type
Including:
Classification by time
of goods transfer
Including:
Classification by
contract duration
Including:
Classification by sales
channel
Including:
Total 266,611,588.18 267,241,929.51
Information relating to performance obligation:
Nil
Information relating to the transaction price assigned to the remaining performance obligation:
The amount of income corresponding to the performance obligations that have been signed at the end of this reporting period but
have not yet been fulfilled or have not done with fulfillment is 0.00 yuan, among them, yuan of revenue is expected to be
recognized in YEAR, yuan of revenue is expected to be recognized in YEAR, and yuan of revenue is expected to be recognized in
YEAR.
Other explanation:
227
Nil
5. Investment income
Unit: RMB/CNY
Item Current period incurred Prior period incurred
6. Other
Nil
XVIII. Supplementary Information
1. Current non-recurring gains/losses
□Applicable Not applicable
2. ROE and EPS
Earnings per share
Profits during report period Weighted average ROE
Basic EPS(RMB/Share) Diluted EPS(RMB/Share)
Net profit attributable to
common shareholder of the -14.30% -0.013 -0.013
Company
Net profit attributable to
common shareholder of the
-14.36% -0.013 -0.013
Company after deducting
nonrecurring gains and losses
3. Difference of the accounting data under accounting rules in and out of China
(1) Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□Applicable Not applicable
(2) Difference of the net profit and net assets disclosed in financial report, under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□Applicable Not applicable
(3) Explain accounting difference over the accounting rules in and out of China; as for the difference
adjustment for data audited by foreign auditing organ, noted the name of such foreign organ
Nil
228
4. Other
Nil
Board of Directors of
Shenzhen China Bicycle Company (Holdings) Limited
21 April 2023
229
